Singapore’s central bank chief sees ‘no alternative’ to US dollar assets despite downgrade

US dollar-based assets have “enduring advantages” and remain virtually irreplaceable in the global financial system despite the United States losing its top triple-A credit rating, according to Singapore’s central bank chief.

“They are the dominant, safe assets for use in the financial system, deeply embedded,” Monetary Authority of Singapore Managing Director Chia Der Jiun said at the Qatar Economic Forum on Tuesday.

“The US$28-trillion Treasury market is fundamental and systemic to the global financial system and there is no alternative for this point.”

Moody’s Ratings last week stripped the US of its top credit rating, a landmark move that casts doubt on the nation’s status as the world’s highest-quality sovereign borrower.

In lowering the US by one notch below the highest investment-grade position, the credit rater joins Fitch Ratings and S&P Global Ratings in downgrading the world’s biggest economy. US long-dated debt initially sold off in response to the Moody’s downgrade.