In a first, Fed Governor Christopher Waller raised concerns over the de-dollarization agenda initiated by BRICS. The BRICS alliance kick-started the de-dollarization movement giving importance to local currencies in global trade and not the US dollar. Local currencies will take prominence to settle cross-border transactions leaving behind the US dollar. The move adds pressure on the USD as other leading currencies aim to surpass its dominance in the international sector.
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Read here to know how many sectors in the US will be affected if BRICS ditches the dollar for trade. Fed Governor Christopher Waller acknowledged that the BRICS de-dollarization initiative is taking a serious turn against the US dollar. He confirmed that the Fed is keeping a close eye on the de-dollarization policies and their impact on the US economy.
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Fed Governor Concerned Over De-Dollarization Agenda Started By BRICS Alliance
The Fed Governor Christopher Waller mentioned the BRICS de-dollarization agenda as the opening remarks at a conference on the international role of the US dollar. Waller said that the US dollar has been the world’s de facto “reserve currency” and a dominant exchange in the markets.
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He touched on the topic of the ‘US dollar’s dominance coming to an end‘ and how BRICS is pushing for de-dollarization. Fed’s Waller acknowledged that a shift in the global balance against the US dollar is occurring in real-time. However, he reaffirmed that the US dollar remains strong despite the de-dollarization challenges from BRICS.
“There has been for some time commentary predicting that the dollar is destined for demise–potentially an imminent demise,” Fed Governor Christopher Waller said in his opening remarks. “The dollar remains by far the most widely used currency by a number of metrics,” he said.
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“Recent developments that some have warned could threaten that status have, if anything, strengthened it, at least so far,” he said. In conclusion, while the Fed Governor is cautious about BRICS’ de-dollarization, he believes the US dollar can overcome the challenge.