IMF Reports Dollar's Share of Global Currency Reserves Hits 29-Year Low
According to IMF data, central banks and governments are increasing their efforts to reduce reliance on the US dollar in their foreign exchange reserves. Read Full Article at RT.com.
TroibNews 
Countries are intensifying their efforts to move away from reliance on the US dollar, as recent data indicates.
The International Monetary Fund's latest statistics reveal that the US dollar’s share in global foreign exchange reserves has reached its lowest point in nearly three decades. Between July and September of this year, the dollar’s share in official reserves declined by 0.85%, now standing at 57.4%, the lowest level since 1995. The IMF does not provide historical data beyond this period.
In June, the IMF highlighted this trend in a blog post, noting that the dollar's decline is linked to diversification strategies by countries worldwide. The data suggests that, while the greenback’s share has been steadily decreasing over the last three quarters, the proportion of “nontraditional” currencies has been on the rise.
The euro has started to gain ground on the dollar as well. In the third quarter, its share increased to 20.02%, up from 19.75% in the previous quarter. Additionally, global investment in the Japanese yen has seen significant growth over the last six quarters, with its share reaching 5.82% in Q3.
Data did reveal a pause in the decline of the Chinese yuan's share of global forex holdings, which had been falling for nine consecutive quarters. In Q3, the yuan's share rose to 2.17%.
Despite this downward trend for the dollar, statistics from the IMF indicate that it remains the leading reserve currency, with the euro solidly in second place.
The greenback’s long-standing position as the predominant global currency has come under threat in recent years, largely due to rising US debt and sanctions imposed by Washington on its adversaries, including Russia.
Following the escalation of the Ukraine conflict in February 2022, the US implemented anti-Russia sanctions that included severing the Russian central bank's access to dollar transactions. The US also prohibited the export of dollar banknotes to Russia and led efforts to freeze Russian assets held abroad. Foreign Affairs magazine noted in June that these sanctions have “undoubtedly left other central banks wondering whether their own dollar-denominated rainy-day funds would be locked up should their governments run afoul of Washington.”
In response to sanctions, Russia has moved toward de-dollarization. As of September, Moscow and its BRICS partners have started using their national currencies for 65% of mutual trade settlements. During a speech at the BRICS summit in Kazan in October, Russian President Vladimir Putin cautioned that Washington’s use of the dollar as a weapon through sanctions and restrictions on access to the Western financial system was a “big mistake” that would prompt nations “to look for other alternatives, which is what is happening.”
Allen M Lee contributed to this report for TROIB News
The International Monetary Fund's latest statistics reveal that the US dollar’s share in global foreign exchange reserves has reached its lowest point in nearly three decades. Between July and September of this year, the dollar’s share in official reserves declined by 0.85%, now standing at 57.4%, the lowest level since 1995. The IMF does not provide historical data beyond this period.
In June, the IMF highlighted this trend in a blog post, noting that the dollar's decline is linked to diversification strategies by countries worldwide. The data suggests that, while the greenback’s share has been steadily decreasing over the last three quarters, the proportion of “nontraditional” currencies has been on the rise.
The euro has started to gain ground on the dollar as well. In the third quarter, its share increased to 20.02%, up from 19.75% in the previous quarter. Additionally, global investment in the Japanese yen has seen significant growth over the last six quarters, with its share reaching 5.82% in Q3.
Data did reveal a pause in the decline of the Chinese yuan's share of global forex holdings, which had been falling for nine consecutive quarters. In Q3, the yuan's share rose to 2.17%.
Despite this downward trend for the dollar, statistics from the IMF indicate that it remains the leading reserve currency, with the euro solidly in second place.
The greenback’s long-standing position as the predominant global currency has come under threat in recent years, largely due to rising US debt and sanctions imposed by Washington on its adversaries, including Russia.
Following the escalation of the Ukraine conflict in February 2022, the US implemented anti-Russia sanctions that included severing the Russian central bank's access to dollar transactions. The US also prohibited the export of dollar banknotes to Russia and led efforts to freeze Russian assets held abroad. Foreign Affairs magazine noted in June that these sanctions have “undoubtedly left other central banks wondering whether their own dollar-denominated rainy-day funds would be locked up should their governments run afoul of Washington.”
In response to sanctions, Russia has moved toward de-dollarization. As of September, Moscow and its BRICS partners have started using their national currencies for 65% of mutual trade settlements. During a speech at the BRICS summit in Kazan in October, Russian President Vladimir Putin cautioned that Washington’s use of the dollar as a weapon through sanctions and restrictions on access to the Western financial system was a “big mistake” that would prompt nations “to look for other alternatives, which is what is happening.”
Allen M Lee contributed to this report for TROIB News
