“We expected that the de-dollarization continued its slow proceeding. However, the ideological change under the second Trump administration could accelerate the process “. Underlines it Mali Chivakul, Emerging Markets Economist by J. Safra Sarasin explaining that in the last 10 yearsBRICS have prepared the ground for de-dollarization, But they only made limited progress. The currencies of the Brics are far from satisfying all the criteria of a reserve currency, including stability, liquidity, market depth and state of law. In addition, not all members have fully embraced the de-dollarization program led by Russia and China.
De-dollastation of the BRICS
India, For example, he publicly declared that he did not actively pursue de-dollarization. The main reason why India wants to be part of the alternative system is that it still wants to have commercial relations with some countries that have difficulty trading in US dollars.
Although he is not actively trying to de-dollarizethe new US currency policy “will probably make India reflect. According to Stephen Miran, president of the US Council of Economic Advisers, the dominant role of the dollar on a global level has increased its demand and has appreciated its value, leading to reduced competitiveness of exports, persistent commercial deficits and erosion of the US manufacturing sector. Del Dollar confers benefits and political levers as lowest rates and the possibility of applying financial penalties “.
Impossible mission or near future?
Even if US politicians would like to preserve the status of the dollar as a global reserve currency, They would like to share the “weight” with their commercial partners through the Treasury’s duties and foreign holders through a user fee Or a potential swap in Century Bond at zero rate or low interest. Friends of the United States will benefit from their safety umbrella and a lower burden.
This new position – explains the expert – will have a series of consequences. The increase in duties could reduce the demand for dollars, since China, for example, markets more with other economies of the emerging markets and regulates the exchanges in renminbi or in local currency. A user fee or Century Bond would make dollar assets less attractive and weaken the dollar. The emphasis on the financial extraterritoriality of the United States It could push a greater number of countries to consider alternative payment systems. The new BRics Pay, introduced last October, it could prove useful in this sense.
The scenarios
Even if the Dollar domain It remains rooted, the trend of the de-dollarization “could now be a little faster. They It should be the main beneficiary of this trend. With the new tax expansion plan of Europe, the euro could also be another option for BRICS aimed at storing liquidity In this increasingly multipolar world. “
