section_path: Views/Economics/Monetary policy
section_name: Monetary policy
paragraph_text: Monetary policy
  
  On August 23, 2019, Carney delivered a speech at the Federal Reserve Bank of Kansas City 's 2019 annual Jackson Hole Economic Symposium entitled "The Growing Challenges for Monetary Policy in the current International Monetary and Financial System". Carney said that the "widespread use of the US dollar"—the dominant currency pricing—"in trade invoicing, in place of the currency of either the producer or the importer", has had a "destablilizing" effect on the global economy. About 50 per cent of international trade relies on the US dollar as the "currency of choice". This represents "five times greater than the US's share in world goods imports, and three times its share in world exports". Dominant currency pricing is not problematic when there is "synchronized growth" globally, Carney said. When "the tide is rising in America while receding elsewhere", the system needs to be revamped. Carney cited an article by Markus Brunnermeier, Harold James, and Jean-Pierre Landau on the potential role of digital currency area (DCA) in redefining the international monetary system.
  
  Speaking just hours after US President Donald Trump posted a tweet blaming Federal Reserve chairman Jerome Powell 's policies for creating fears of an economic recession and threatening China with more retaliatory tariffs, Carney urged central banks to collaborate in replacing the US dollar as reserve currency. He cautioned against choosing another new hegemonic reserve currency like the renminbi and suggested instead, a "new Synthetic Hegemonic Currency" (SHC), such as Libra, which could potentially be provided "through a network of central bank digital currencies", that would decrease the US dollar's "domineering influence" on trade worldwide.