The U.S. dollar’s global dominance is slowly eroding due to multiple factors. Rising economic might of China, de-dollarization efforts by the BRICS countries and other economies, and the widespread adoption of cryptocurrencies are the main reasons of this downward movement. Fitch Solutions’ global head of country risk, Cedric Chehab, pointed out that the U.S. dollar’s reduction in status will be a slow erosion and not a paradigm shift. The emergence of central bank digital currencies also suggests a decrease in reliance on the U.S. dollar. China’s large presence as a trade partner for many economies indicates that it will have more influence and subsequent power in the global market. This however does not imply that the U.S. dollar will lose its status as the world’s reserve currency soon. Nevertheless, these factors have already begun to have an impact and will continue to do so in the future.
John Hughes
- 2023-04-19
Global Decline of the US Dollar
The U.S. dollar’s global dominance is slowly eroding due to multiple factors such as rising economic might of China, de-dollarization efforts and widespread adoption of cryptocurrencies. This article explores the emerging trends and their implications on future.
