Dollar Holdings Fall in India and China

From the FT:

The Asian central and commercial banks covered in the BIS data held only 67 per cent of their deposits in dollars as of September 2004, down from 81 per cent in the third quarter of 2001, said the Basel-based bank.

The data indicate the shift out of the dollar was most evident in India, where dollar holdings fell from 68 per cent to 43 per cent during the three-year period. Chinese banks have reduced their dollar share from 83 per cent to 68 per centa cut that mostly happened before the third quarter of 2002.

On first blush these numbers are a lot like the news out of S. Korea but they also have a more positive interpretation that the adjustment is behind rather than ahead. The article also points out that the shift is caused more by a falling dollar than by any change to buying habits.