While inflation data in Europe and the U.S. has risen significantly higher last month, Russia and members of the BRICS countries revealed leaders in the five major emerging economies are in the midst of “creating an international reserve currency.” Analysts believe the BRICS reserve currency is meant to rival the U.S. dollar and the International Monetary Fund’s (IMF) Special Drawing Rights (SDRs) currency.
Russia and Putin have been saying that the U.S. dominance in the world of finance has been dying for years now. In October 2018, speaking at the Valdai forum, Putin said the U.S. sanctioning specific countries (including Russia) would undermine trust in the U.S. dollar.
And the moment comes when it can’t handle them, neither in the security sphere or the economic sphere.
“Politicizing, instrumentalizing and weaponizing the world economy using a dominant position in the global financial system to wantonly impose sanctions would only hurt others as well as hurting oneself, leaving people around the world suffering,” Xi detailed. “Those who obsess with a position of strength, expand their military alliance, and seek their own security at the expense of others will only fall into a security conundrum.”
“For now, we still expect the dollar to trade on the front foot,” Trivedi wrote on July 16. “There might be a bit more to go, but probably the largest part of the dollar move may well be behind us.”
What do you think about the BRICS nations creating a new international reserve currency to rival the U.S. dollar and IMF’s SDRs? Let us know what you think about this subject in the comments section below.