BRICS: Neither the Alliance nor the Euro Are a Threat to the Dollar Right Now
28.06.2024 19:00 2 min. read Alexander Stefanov
The US dollar remains the world's leading reserve currency, with neither the euro nor the BRICS countries significantly reducing the world's dependence on it, according to a recent analysis by the Atlantic Council's Geoeconomics Center.
The report “Dollar dominance overview” indicates that the US currency maintains its superiority in global foreign exchange reserves, trade invoices and foreign exchange transactions. It is expected to remain the world’s dominant reserve currency for the foreseeable future.
The recent strengthening of the US dollar’s global position has been driven by a strong US economy, tighter monetary policies and heightened geopolitical uncertainty, despite efforts by BRICS countries to switch to other currencies.
В the report it is also emphasized that the Western sanctions against Russia, imposed by the G-7 after the Russian invasion of Ukraine, have prompted the BRICS countries to seek a currency union. However, they have not yet made significant progress in reducing their dependence on the dollar.
The BRICS Union has faced challenges in advancing de-dollarization. The report notes that China’s Cross-Border Interbank Payment System (CIPS) has expanded significantly, adding 2023 direct participants from May 2024 to May 62, reaching a total of 142 direct and 1394 indirect participants.
Negotiations for an internal union payment system are still in their infancy, and although bilateral and multilateral agreements within the group could eventually lead to a currency exchange platform, these agreements are complex and not easily scalable, the report said.
The report also mentions that the euro, which once looked at as a potential rival to the dollar, is losing ground as an alternative currency. In response to geopolitical risks, such as sanctions against Russia, reserve managers are increasingly turning to gold instead of the euro. In addition, concerns about macroeconomic stability, fiscal consolidation and the lack of a single European capital market are weakening the international role of the euro.
-
1
Trump Targets Powell as Fed Holds Rates: Who Could Replace Him?
27.06.2025 9:00 2 min. read -
2
U.S. PCE Inflation Rises for First Time Since February, Fed Rate Cut Likely Delayed
27.06.2025 18:00 1 min. read -
3
Key U.S. Economic Events to Watch Next Week
06.07.2025 19:00 2 min. read -
4
Gold Beats U.S. Stock Market Over 25 Years, Even With Dividends Included
13.07.2025 15:00 1 min. read -
5
U.S. Announces Sweeping New Tariffs on 30+ Countries
12.07.2025 16:30 2 min. read
US Inflation Heats Up in June, Fueling Uncertainty Around Fed Cuts
U.S. inflation accelerated in June, dealing a potential setback to expectations of imminent Federal Reserve rate cuts.
Gold Beats U.S. Stock Market Over 25 Years, Even With Dividends Included
In a surprising long-term performance shift, gold has officially outpaced the U.S. stock market over the past 25 years—dividends included.
U.S. Announces Sweeping New Tariffs on 30+ Countries
The United States has rolled out a broad set of new import tariffs this week, targeting over 30 countries and economic blocs in a sharp escalation of its trade protection measures, according to list from WatcherGuru.
Key U.S. Economic Events to Watch Next Week
After a week of record-setting gains in U.S. markets, investors are shifting focus to a quieter yet crucial stretch of macroeconomic developments.
-
1
Trump Targets Powell as Fed Holds Rates: Who Could Replace Him?
27.06.2025 9:00 2 min. read -
2
U.S. PCE Inflation Rises for First Time Since February, Fed Rate Cut Likely Delayed
27.06.2025 18:00 1 min. read -
3
Key U.S. Economic Events to Watch Next Week
06.07.2025 19:00 2 min. read -
4
Gold Beats U.S. Stock Market Over 25 Years, Even With Dividends Included
13.07.2025 15:00 1 min. read -
5
U.S. Announces Sweeping New Tariffs on 30+ Countries
12.07.2025 16:30 2 min. read