The US dollar is becoming increasingly toxic in global markets, and this reality forces countries around the world to seriously rethink their financial strategies for now. One of Russia’s most well-known economists says the dollar has been weaponized as long as the world countries are running around for alternative options, which is already transforming foreign exchange reserves and currency diversification policies, as well as global trade patterns in ways and scope that they have never experienced before.
The toxic effects of the US dollar, derailment, diversification of currency, trade
Experts alarm to political weaponize the dollar
Sergei Graziev, commissioner of the Eurasian Economic Union and commissioner of integration and macroeconomics, has not beaten the bushes around, expressing his opinion on how bad Western currency is doing at this point. His assessment led to main arguments and debates that are eye-opening for those chasing the power of money around the world.
The only IMF reserve currency that is ultimately not politically toxic is the yuan. Conversely, mistrust is a major issue in Western currencies such as the US dollar, euro, pound, and yen.
These are weapons of political warfare, Graziev interviewed at the Chingyan Institute for Financial Research. Many economists quietly discuss this US dollar profiling as a poison. This means that the dollar’s myth of being a neutral global currency has been undermined and the nation is beginning to reward key strategic measures.
China and Russia absent bills from dollar dependence
The numbers have a good argument about how serious this trend of decommunity has become. Russian Foreign Minister Sergei Lavrov has revealed several key figures to show how ingrained this transition has already been. In fact, practical cooperation between Russia and China is gradually expanding regardless of geopolitical turbulence on a global scale.
Since 2010, China has been Russia’s biggest trading partner, and in 2023 Russia ranked fourth among China’s foreign trade partners. In the meantime, their currency – the rubles and yuan – currently account for more than 90% of all mutual trade transactions.
Forex reserves win a big transformation
The increase in original international payments is particularly noteworthy now. The latest Swift data showed that the original share in international payments reached 4.69% in March, the fourth most actively used currency, which is actively used in global payments ahead of the yen.
Experts said this reflects steady progress in the original internationalization and the increasing appeal of the original as a currency for payments and settlements around the world.
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Glazyev proposes that Russia and China develop enhanced mechanisms for payment currencies, and is also promoting the creation of digital non-bank payment systems. The system is linked to stablecoins backed by products such as gold, silver and other exchange-selling products.
Perhaps in the near future, BRICS countries can create new world currencies, he said, in digital formats guaranteed by their goods and in accordance with international practices.
Both Russia and China announced that they have set up a digital currency for the central bank. These digital currencies accelerate international settlements, reduce processing fees for cross-border fund transfers, and now offer affordable gateways to global financial networks.
International trade patterns are changing rapidly
The impact on international trade is substantial and extremely fast. Bilateral currency arrangements replace traditional dollar-controlled transactions at a pace that even veteran economists can see astounding.
The country has established a new trade corridor that completely bypasses the dollar requirements, which has enacted many important changes that fundamentally altered established commercial patterns. What we are looking at is not just temporary adjustments. It is a structural change that has lasting implications for global finance.
Glazyev said China’s economy is diverse and dynamic, adding that China leads many high-tech sectors such as solar energy, artificial intelligence and other information technologies.
The accelerated trends suggest that currency diversification continues to expand, with more countries seeking to protect their economic interests through reduced dollar exposure. Now we are witnessing what appears to be the beginning of a major change in the way global finance operates, and the toxic reputation of the US dollar catalyzes a variety of major changes across the international market.
