The US dollar is the most important currency in the markets that controls and dominates the world’s financial sector. Almost all cross-border transactions, trade settlements, and foreign exchange conversions are conducted using the USD. Local currencies are far behind with little to no chance of becoming the global reserve currency. This gives the White House the power to weaponize the currency and control the world’s trade and finances. BRICS has decided to put an end to the US dollar domination by giving local currencies a chance to compete against the greenback.
Also Read: BRICS: US Dollar Is Now an Unreliable Currency, Say Analysts
Here’s What Will Happen If BRICS Ends US Dollar Reliance
The BRICS alliance is scheming to replace the US dollar with either a new currency or their local currencies. The bloc is divided in the prospects but is united to achieve the goal by hook or crook. They also confirmed that despite slow progress, the alliance’s long-term goal is to bring the US dollar down. America imports the USD to other countries and using it for transactions leads to surplus. However, ending reliance on the greenback will lead to a deficit allowing the economy to face a crisis.
Also Read: BRICS: China Orders All Banks To Reduce US Dollar Purchases
Top 3 US sectors that could decline if BRICS ditches the dollar for trade:
- Banking and Finance
- Technology and Fintech
- International Trade and Investment
These three sectors will be the hardest hit and lose control if BRICS officially ditches the US dollar for trade. All three sectors are closely linked to the American economy and the financial markets as we know it will fall apart. Turbulence in the banking and investment sector will spill over to other markets eventually bringing the US economy down. It could lead to hyperinflation in the homeland making the costs of daily essentials skyrocket. Consumer spending could decline and eat into revenues of American corporations eventually leading to job losses.
Also Read: BRICS: China & Brazil Officially Announce to Trade in Local Currencies
