Where have all the petrodollars gone?
MARKET VOICE
Surging oil prices and oil exporter revenues have put the investment of 'petrodollars' back at the centre of international investors' concerns. We, and market participants more generally, have assumed that the oil-price driven shift of current account surpluses from emerging Asia to oil exporters will result in a shift of demand away from US dollar-denominated securities that would undermine the dollar.
However, oil exporters have 'parked' a large fraction of their surpluses in US dollar bank
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