Russia's Vladimir Putin claims the Biden administration is 'killing' the USD by using it as a weapon — says 'blow was dealt' to America and even its allies are now 'downsizing' the dollar

Date:

Share post:


Russia's Vladimir Putin claims the Biden administration is 'killing' the USD by using it as a weapon — says 'blow was dealt' to America and even its allies are now 'downsizing' the dollar

Russia’s Vladimir Putin claims the Biden administration is ‘killing’ the USD by using it as a weapon — says ‘blow was dealt’ to America and even its allies are now ‘downsizing’ the dollar

Russia’s president Vladimir Putin has once again taken aim at the U.S. dollar — accusing President Joe Biden’s administration of “killing [it] with [its] own hands” after using the currency as a weapon of foreign policy.

In a new and highly divisive interview with Tucker Carlson, the Russian leader said: “The dollar is the cornerstone of the United States’ power… it is the main weapon used by the U.S. to preserve its power across the world.

Don’t miss

“As soon as the political leadership decided to use the dollar as a tool of political struggle, a blow was dealt to this American power.”

To illustrate that alleged decline in the dollar’s dominance, Putin — whose comments were translated live from Russian to English — pointed out that “even the U.S. allies are downsizing the dollar in their reserves.”

Is this trend away from the greenback — known as de-dollarization — really as bad as Russia’s president makes it out to be?

Was the writing on the wall?

De-dollarization occurs when countries shift away from the dollar as a reserve currency, medium of exchange or unit of account. The U.S. has repeatedly dismissed any notions that this is a problem — instead deeming it a “natural desire [for countries] to diversify” their economies.

But Putin implied Russia’s hand was forced to ramp up its de-dollarization plans after its invasion of Ukraine in 2022, which triggered a backlash of heavy sanctions by the U.S. and other Western powers. Russia was also kicked off the world’s main international payments network Swift.

“Look at what is going on in the world,” Putin told Carlson. “Until 2022, nearly 80% of foreign transactions in Russia were settled in U.S. dollars or euros. Currently, it is now down to 13%… By the way, our transactions in yuan accounted for about 3%. Today, 34% of our transactions are made in rubles, and about as much, a little over 34%, in yuan.”

While Putin blamed the sanctions in this most recent interview, many would argue the writing has long been on the wall regarding Russia’s de-dollarization.

Russia is a founding member of BRICS, a group of emerging market economies — including China, India, Brazil, South Africa and many more — who are trying to settle major trades in their local currencies instead of the U.S. dollar. This movement is gaining momentum as countries try to reduce transaction costs, limit their exposure to global volatility and geopolitical risks and boost their local economies.

Read more: Thanks to Jeff Bezos, you can now cash in on prime real estate — without the headache of being a landlord. Here’s how

What does the de-dollarization data say?

The Russian president’s warning about the greenback is well-timed. It comes amid heightened speculation around the dollar’s position as the world’s reserve currency, in large part due to the nation’s historic $34 trillion mountain of debt.

According to data from the IMF, the greenback’s share of global allocated foreign exchange reserves has fallen by around 6% since early 2016.

However, the U.S. dollar still accounted for 59.17% of global allocated foreign exchange reserves in the third quarter of 2023 (the latest data set) — a stark contrast to the Chinese yuan’s 2.37% of reserves in the same period.

Analysts at FXC Intelligence, who recently published a report on de-dollarization, stated: “Our research shows that de-dollarization is happening, but… it is by no means rapid.

“It is instead currently on course to be a slow process over the next couple of decades as countries shift to a broader range of currencies, likely to provide greater hedging from future possible geopolitical shocks.”

What to read next

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.



Source link

Alexandra Williams
Alexandra Williams
Alexandra Williams is a writer and editor. Angeles. She writes about politics, art, and culture for LinkDaddy News.

Recent posts

Related articles

A party like no other? Asia's richest man celebrates son's prenuptials with a star-studded bash

NEW DELHI (AP) — What happens when the son of Asia's richest man is about to get...

Ivanka Trump and her shiny sari are attempting to single-handedly revive the glamorous face of Trumpworld at Ambani's pre-wedding bash

Also spotted at the festivities were Mark Zuckerberg and his wife, Priscilla Chan. The extensive guest list...

Hasan vows to cover Trump legal cases differently: ‘We will stop with this charade’

Former MSNBC host Mehdi Hasan vowed Friday that his new company will cover the former President Trump’s...

German ‘Plot’ to Bomb Crimean Bridge Sparks Moscow Meltdown

Counterintelligence agents in Germany have sprung into action after one of Vladimir Putin’s top allies in the...

Man charged with attacking police in Times Square, vilified in Trump ad, was misidentified, DA says

NEW YORK (AP) — A Venezuelan man who became the subject of national attention for allegedly kicking...

A lone orca killed a great white in less than two minutes. Scientists say it could signal an ecological shift

Sign up for CNN’s Wonder Theory science newsletter. Explore the universe with news on fascinating discoveries, scientific advancements...

Case dismissed against Florida teen migrant accused of homicide in police officer's death

The case has been dismissed against a teen migrant from Guatemala almost a year after he was...

Multi-Passenger Brawl Erupts on RyanAir Flight: ‘There Was No Calming the Situation’

"The crew were unable to control and the pilot stayed in his cockpit until the end,”...