Economists: Monopoly of the Dollar to Be Replaced by Troika Including Euro, Yuan
SputnikNews.com
13.06.2018
Concerns about the fall of the dollar-dominated financial system have been raised for decades, but for now the US currency remains firm in its commanding position.
An aggressive trade policy and significant sovereign debt on the part of the US could result in the start of a de-dollarization process, experts at the World Bank say. They point out that currently, about 70% of all world trade transactions are accounted for by the US currency, about 20% by the euro and the rest is divided among Asian currencies. But the situation could change in a matter of decades.
One of the most recent blows to the dollar’s dominance was made by China with the introduction of its petro-yuan, which Beijing will use to buy oil and gas. That means that a huge chunk of the Chinese market will be closed to the US currency.
The foreign policy of the current US administration has also closed access to the dollar for another major player on the oil market, Iran, has which imposed a ban on using the US currency in transactions, sticking instead to the euro.
Some countries have even agreed to pay for Iran’s oil with their national currencies, like India did, which will use rupees in transactions with Tehran. This will allow New Delhi to bypass the new sanctions that Washington will impose against Iran after withdrawing from the JCPOA. It has been reported that Turkey and Russia are considering similar options.
‘Gold Rush’
Another tendency is the withdrawal of gold reserves from the US. The Turkish Central Bank decided to bring its 220 tons worth of gold home from the US amid tensions with Washington over buying S-400 air defense systems from Russia. Germany and the Netherlands did this back in 2012, bringing 300 and 100 tons respectively back to their countries.
Keith Neumeyer, chairman of the company First Mining Gold, pointed out that due to the increasing interest rates of the Federal Reserve System (FRS), the US pressure on the euro and growing geopolitical risks may cause a further outflow of foreign gold reserves from the FRS.
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