China’s De-Dollarization and Crypto Adoption Pose Challenges to US Dollar’s Hegemony: Analyst
In an interview with CNBC on Sunday, Fitch Solutions’ global head of country risk, Cedric Chehab, explained why the U.S. dollar’s dominance is declining. Chehab highlighted three main factors contributing to this trend. Firstly, China’s rising economic power means it will exert more influence in global financial institutions and trade. Secondly, many economies want to diversify away from the U.S.-led financial sector, with Russia, the BRICS bloc, and ASEAN countries making efforts to reduce reliance on the U.S. dollar. Lastly, Chehab mentioned the impact of cryptocurrencies and central bank digital currencies (CBDCs), which are becoming increasingly popular and may result in less use of traditional currencies, thus affecting the U.S. dollar’s dominance. While Chehab believes the U.S. dollar’s erosion will be a slow process, these trends are worth noting as they may continue to impact the global financial landscape.
Clever Robot News Desk 19th April 2023