The de-dollarization movement has taken a significant hold in global economics. More and more countries have expressed the desire to move away from the US dollar for trade. The BRICS bloc of nations has particularly taken a strong inclination for national currencies for mutual trade settlements. The developments have put a question mark on the US dollar’s dominance.
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Chinese Yuan Spearheading De-Dollarization
The Chinese Communist Party (CCP) has pushed to turn the Yuan into an international currency. to The Chinese Yuan has seen a significant increase in international settlements in the last few years. China’s efforts have further propelled the de-dollarization agenda.
According to economist Jin Keyu, “Trade invoicing in yuan went from zero percent to 30 percent in the last 10 years, and half of Chinese capital flows are now in yuan, much higher than before.“
Keyu highlighted that de-dollarization has seen a substantial increase in recent times. She added that “non-conventional reserve currencies – even outside of the yuan – have jumped from 2 percent to 11 percent.“
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China has issued $45 billion of offshore yuan as of February. In a February report, the People’s Bank Of China said it has signed bilateral currency swap agreements with more than 40 foreign central banks. The move further sheds light on the growing de-dollarization sentiment.
Can Trump Bring The US Dollar Back On Top?
President Trump has said that he would levy heavy tariffs on countries moving away from the US dollar. The US President said he would impose 100% to 150% tariffs on countries attempting this process.
Also Read: De-Dollarization Explained: Russia, China, India, Brazil, Malaysia Lead Global Push to Bypass U.S. Dollar
Trump could be the savior for the US dollar. He has taken a strong stand against anti-US businesses. His policies could revive the US dollar to its former glory. How things unfold is yet to be seen.
