Leading U.S. economist and gold proponent Peter Schiff has warned that the dollar crisis could begin as soon as 2025. The USD is already in a precarious position as developing countries are ending dependency on the currency. This strengthens the BRICS agenda of de-dollarization that could further weaken the U.S. dollar. It’s only a matter of time before things head south that could become a full-blown economic crisis, the analyst explained. According to Schiff, the DXY index, which measures the performance of the U.S. dollar is showing major signs of weakness.
Also Read: BRICS: 85% Trade Settled in Local Currencies, Not US Dollar
The index tracks the value of the USD against a basket of foreign currencies, including the euro, Japanese yen, British pound, Canadian dollar, Swedish krona, and Swiss franc. The index is now at 104.28 and Schiff forecasted that it could dip below the 90 level in 2025.
Read here to know how many sectors in the U.S. will be affected if BRICS ditches the dollar for trade. Schiff rang the warning bells explaining that the economy crashing could send consumer prices and long-term interest rates soaring. “I think that low will be breached in 2025. Triggering a U.S. dollar crisis, crashing the economy, and sending consumer prices and long-term interest rates soaring,” he said.
Also Read: Goldman Sachs Predicts the Future of BRICS Currency
U.S. Dollar Decline a Turning Point For BRICS
BRICS is looking to topple the U.S. dollar as the world’s reserve and replace it with local currencies. The alliance is working towards a new payment mechanism that will not integrate the U.S. dollar for global trade and transactions. The bloc will either use a basket of local currencies or settle cross-border transactions in a soon-to-be-launched currency.
Also Read: Local Currency That Challenged the US Dollar Fails, Dips 40%
Developing countries are ganging up against the U.S. claiming that the White House has weaponized the dollar through sanctions. The next few years will be a litmus test for the USD as it’s directly on the line of fire. If BRICS navigates the de-dollarization initiative well, the U.S. dollar could be on the path of a decline.
