Why the World Is Dumping the American Dollar | Vantage with Palki Sharma
China and Brazil have struck a deal to trade in their local currencies instead of the US dollar. They joined a long list of countries including Saudi Arabia, Kenya and India. Why is the world attempting to de-dollarise? Palki Sharma decodes
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The American dollar has long been considered the world’s most powerful currency. It is the standard currency for international trade, and countries around the world hold vast reserves of dollars in their central banks. However, there are growing signs that the world is beginning to dump the dollar. In this article, we explore some of the reasons behind this trend.
One key reason why more countries are moving away from the dollar is the rise of rival currencies. For example, China’s yuan has been gaining prominence in global trade, particularly in Asia. Other currencies, such as the euro and yen, are also becoming more widely used. As these currencies become more widely accepted, it reduces the need for countries to hold dollars. This trend is particularly evident in countries that are seeking to diversify their reserves away from the dollar to reduce their exposure to the volatility of the American market.
Another reason why countries are moving away from the dollar is the increasing use of alternative financial systems. One of the most significant examples of this is China’s Belt and Road Initiative, which is designed to transform international trade routes and create new economic zones across Asia, Europe, and Africa. The initiative operates outside of Western-dominated financial systems, and Chinese businesses and governments can make payments in their own national currencies, reducing the need for dollars.
The US’s increasingly parochial approach to international trade is also contributing to the global shift away from the dollar. Over the past few years, the US has been implementing protectionist trade policies, such as imposing tariffs on Chinese goods and withdrawing from international trade agreements. These policies have made countries more reluctant to hold dollars as a reserve currency, as the US’s economic policies become more unpredictable.
Finally, the world is becoming less dependent on the US economy. In the post-World War II era, the US was the dominant economic power, and most of the world’s economic activity was tied to the American market. However, that is changing as more developing economies are emerging, particularly in Asia. These countries are becoming more financially and economically independent, reducing their dependence on the US dollar.
In conclusion, the world is beginning to dump the American dollar for a variety of reasons. The rise of rival currencies, alternative financial systems, protectionist US trade policies, and the emergence of new economies are all contributing to this trend. However, it is unlikely that the dollar will lose its position as the world’s most widely held reserve currency anytime soon. Still, countries are becoming more cautious about their reliance on the dollar and are seeking out alternatives, creating a more multi-polar financial landscape.
Do you think the US dollar has lost its sheen? Leave a comment and let us know.
It's alright as long you pay your debt accordingly and responsibly.
You did not mention that the reason the world continues to trade in the dollar is because there is no other democratic economy that is as resilient, drives innovation and dynamic to compete. This is why the dollar is so dependable. China is close in power but it's not a democracy, riddled with geopolitics and pretty much a Mafia without real innovation – just brute force.
People don’t see but China and Russia secretly opened an attack on America. We sent billions to Ukraine and they dropped the currency without an arrow thrown!!!
I do not think you are qualified as a news anchor most likely reading from a script to speculate on currency , stop your fear mongering , may be Fox News could hire you … best of luck to you
Ditch the DOLLAR and loose the country that BACKS FREEDOM WORLD WIDE.
This sounds foolish.
Without FREEDOM, your countries money will become worthless the moment Communist countries decide they want to conquer your country.
I make huge profit on my investment since I started trading with Mrs Shana Heckel , her trading strategies are highly exceptional
if you understood the economy a little, you would understand that they will not be able to achieve something like this – there are some economic laws that these countries cannot respect it !!
Good that means we can keep all our resources and start up our manufacturing again! That will also mean the illegal migrants coming for jobs and what not will head back since the dollar is not valued in their country so sending USD home to family for a high exchange rate will end! Blessing in disguise
Ok Punjabi…the only countries rejecting the dollar are countries that dont have any like Russia, China, maybe india…lol
As a Hindu and Indian I'm totally with China. Cos unlike India, China has a very very clear vision and a plan to achieve that vision.
Our temples are great but modern times require modern solutions and China has it.
Except "the world" isn't "dumping" the dollar. While there are efforts by some countries to reduce their reliance on the US dollar, the claim that "The World Is Dumping The American Dollar" is an overstatement to say the least. The US dollar remains deeply entrenched in the global financial system, and its trust, liquidity, and stability continue to make it the dominant global reserve currency. Although alternative currencies like the Chinese yuan are gradually gaining prominence, the dollar's dominance is not expected to wane significantly in the foreseeable future. It is PURE propaganda to say, "the dollars downfall though, has begun…" Give me a break!
They said the same thing with Crypto Currency. Someone is trying a new scam. Good Luck.
In Breton wood all oil importing countries collapse sue current account deficit nothing but dollar deficit then IMF introduced any country can exchange any other currency with specified regime but still world is following dollar model or Breton wood model
the most stupidiest thing the usa did that they freeze russian forex reserve as they own and incharge of it,now how can any country can trust usa dollar and also continuous interference inside other country politics which is again through the help of us dollar
Joe biden just used the dollar to hurt russia but it back fired severely Now it's like a domino that if started to fall. It is very hard to stop. Joe just triggered it. Hahaha no american will forget about joe bidens legacy as an us president
Putin and xi just did it thanks to joe biden hahaha now usa has only its military to stop this but it cannot stop it even if that it wages a war with china.
Indian rupee is far from being a serious contender,
Evil = English pound
English Pound must come down down down. They have stolen enough from the African continent and ongoing…….and nobody is stopping them.
The English Pound is stealing the wealth of the World !!!!!!
Stop the ENGLISH POUND not the US dollar The English are stealing the Wealth of the World !!!!!
Some economists have projected that both the U.S. and parts of Europe could slip into a recession for a portion of 2023. A global recession, defined as a contraction in annual global per capita income, is more rare because China and emerging markets often grow faster than more developed economies. Essentially the world economy is considered to be in recession if economic growth falls behind population growth.
The shifting of the dollar will hurt the whole world. Good bye world stock market. The great storm is coming! War on the horizon!