Learn from mistakes to prevent meltdowns

HYDERABAD: “The dominant international reserve currency is still the US Dollar, because the US gives highest priority to its domestic economy,” said Dr YV Reddy, former governor of Reserve Bank of India and emeritus professor of University of Hyderabad. Speaking at the Annual Foundation Day Lecture on Future of Financial System: Emerging Issues on Saturday at the university, he said while US financial policies have large impact on the global economy, other countries are still trying to bring reforms in their financial systems. “The modern financial system consists of financial intermediaries, markets and instruments including commercial, investment and universal banks, insurance companies, pension funds,” YV Reddy said. The recent financial crises in several countries has exposed severe weaknesses in all components of financial systems, both public and private. In a country where there is a mixed economic like India, financial fluctuations are more complicated and uncertain, Reddy said.