BRICS is spreading the de-dollarization initiative around the world, but the majority of countries are rejecting the idea by increasingly using the US dollar for trade settlements. While countries that are like-minded to BRICS are considering de-dollarization, the majority of nations don’t align with the initiative.
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The latest data from SWIFT payment messaging system shows that trade settlements in the US dollar have increased by 9%. That’s the most in 12 years despite BRICS trying to convince other countries to ditch the US dollar through de-dollarization. The share of the US dollar’s global payments has touched a record 49% in 2024, the highest in 12 years.
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BRICS De-Dollarization Fails: Payments in US Dollar Surges 9%, Euro Dips 18%
While the US dollar’s global payments rose by 9%, the Euro’s share plummeted from 39% to 21% during the same period. That’s a steep 18% decline that threatens the Euro’s dominant share in the world’s financial sector. Meanwhile, BRICS member China’s local currency, the Chinese yuan also gained the most as its usage increased from 2% in 2023 to 5% in 2024. That’s a surge of 3% in a year indicating that the Chinese yuan is looking to dominate global finances.
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However, despite the Chinese yuan’s rise, the US dollar remains the de facto strongest currency in the world. The de-dollarization agenda has failed to put a ding in the greenback as its usage is only increasing. BRICS might find it hard to push the de-dollarization narrative further as local currencies have little value in the markets.
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Developing countries, whether they like it or not, need the US dollar to survive and keep their economy afloat. The USD has the strongest value and stands against the whiplashes of the currency markets. Local currencies crumble at turbulence and are not suited for bad weather. Therefore, the US dollar is their only hope for survival, and de-dollarization from BRICS is only an eyewash from Russia.