The US dollar has been a global topic of discussion as it continues to project mixed results. The USD is now standing at a new precipice of change, the one that propels the American currency to accept one harsh truth. The fact that the US dollar has lost some of its safe haven appeal has now been confirmed by the ING report; however, this element has yet to impact its global demand and usage.
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The US Dollar Is Wounded but Not Dead
Per the latest report by ING, the US dollar has lost some of its safe haven appeal since 2024. The fact that the USD has consistently fallen to new lows, unable to pick up pace due to the Fed’s volatile rate cut stance, has wounded the USD’s appeal at large. But this development has yet to faze its global demand, which is still reigning supreme. The report later adds how nearly 80% of the US dollar investors are still firmly holding on to the currency. In addition to this, ING confirms how the current dollar drop is more cyclical than structural, negating any signs of de-dollarization weighing more on the US economy.
“The dollar has lost a chunk of its safe-haven value compared to 2024. When measured by calculating the three-month correlation between the dollar index and US stocks and 10-year Treasuries. Private investors, who hold more than 80% of foreign holdings of U.S. assets, remain invested. Dollar weakness, at this stage, appears more cyclical than structural. There are no signs yet of an acceleration in de-dollarization when examining the use of the dollar in global assets. Liabilities, market turnover, and transactions.”
Tough Competition From Gold
The US dollar seems to be going shoulder to shoulder with gold, as 2025 and 2026 both are favouring a precious metal rally at large. With the safe haven crown been flaunted by gold, the investor exodus is constantly torn between USD and gold, with the pool of investors approving the latter asset as the best one for current times.
“BREAKING: The US Dollar now represents ~40% of global currency reserves, the lowest in at least 20 years. This percentage has declined -18 percentage points over the last 10 years. Over the same period, gold’s percentage has increased +12 points, to 28%. The highest since the early 1990s.Gold now accounts for more global FX reserves than Euro, Yen and Pound combined. This comes as central banks continue diversifying away from the US Dollar while rapidly stockpiling gold in their vaults.
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