Hi there Champ"Does that not mean that there will be less demand...

Hi there Champ

"Does that not mean that there will be less demand for US dollars Timber?"

Yes. But it will also means there is less selling of US dollars.

For example:

If a German company sells widgets to a Russian company:

Settling in USD:

Russian Co: Sells Rouble - Buys USD - delivers USD
German Co: Receives USD - Sells USD - Buys - EUR

Settling in Rouble:

Russian Co: Delivers Rouble
German Co: Receives Rouble - Sells Rouble - Buys EUR

You will notice that offsetting purchases and sales of USD have been eliminated. But the net supply and demand for USD is unchanged.


I can see that the turn over in USDs may decrease, but how is that going to weaken the USD? For that an increase in the selling of USDs is needed, and I don't see where that is coming from in these proposed arrangements.

I certainly don't see how it will help the price of gold.