The leaders of the emerging market BRIC countries have demanded a greater role in the global financial system and an overhaul of the monetary system that relies heavily on the dollar. Can these economies pave the way for exchange traded funds (ETFs) to rally within these countries? [Are BRIC Economies and ETFs coming Back?]

The BRIC (Brazil, Russia, India and China) economies say the global economy relies too heavily on the U.S. dollar, as the leaders of these countries want to lower the importance of the greenback within international financial transactions. A shift in the move toward a multi-currency reserve and trading system is dawning, but there is still a long road ahead for the emerging economies.[BRIC ETFs In Focus As Leaders Demand Monetary Revamp.]

David Marsh for MarketWatch reports on some of the action taking place within the BRIC economies:

  • Addition of South Africa to the former BRICS format seems to have galvanized the grouping. The five countries agreed to expand use of their own currencies in trade with each other — an important step toward putting the dollar into a new downsized place.
  • The BRICS’ state development banks, including the China Development Bank, agreed to use their own currencies instead of the dollar in issuing credit or grants to each other — and they will also phase out the dollar in overall settlements and lending among each other.
  • Fresh signs of a disturbing lack of equilibrium in the Chinese economy, have heightened speculation that China will speed up a rise in the renminbi to lower import prices.

Various BRIC ETF Plays:

  • iShares MSCI BRIC Index Fund (NYSEArca: BKF)
  • Guggenheim BRIC ETF (NYSEArca: EEB)
  • SPDR S&P BRIC 40 ETF (NYSEArca: BIK)

Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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