Daily Memo: The Mighty Dollar

Russia and China are trying to get off of greenbacks.

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Getting off the dollar. Russia and China are finding ways to reduce their dependencies on the almighty greenback. According to Russia’s Central Bank and Federal Customs Service, the dollar’s share of trade between Russia and China dropped to 46 percent of settlements in the first quarter of 2020 – a 90 percent drop from 2015, and the first time ever it dipped below 50 percent. Partly that’s because the dollar was partially replaced by the euro, which accounted for a record 30 percent of settlements, and partly because it was replaced partially by their own currencies, which accounted for a record 24 percent. The use of the dollar in global trade and finance is an incredible source of wealth and influence for the U.S. Over the past few years, the U.S. has increasingly sought to weaponize the world’s dependence on the dollar in pursuit of various strategic aims, particularly with sanctions. Naturally, China and Russia are leading the charge among countries – including many in the West – that want to deprive the U.S. of this leverage. China, in particular, is considering all sorts of innovative tools, such as cryptocurrencies, with which to engage in international trade without the dollar […]

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