Emerging Trends: CEO of Major Russian Bank Foresees Chinese Yuan’s Ascendance amid US Dollar’s Decline
According to the CEO of VTB Bank, Russia’s second-largest bank, the US dollar is on the brink of losing its position as the dominant global currency due to the increasing influence of the Chinese yuan.
In an interview with Reuters, Andrey Kostin highlights that the US and its allies’ efforts to block Russia’s access to substantial gold and foreign exchange reserves are compelling many nations to seek alternative currencies for international trade settlements, moving away from the USD. Kostin suggests that China’s gradual relaxation of its stringent currency controls could pave the way for the yuan to replace the dollar. He emphasizes that China recognizes the need to remove currency restrictions to establish itself as the leading global economic power.
Moreover, Kostin considers it risky for China to continue accumulating US debt. Echoing this sentiment, billionaire investor Ray Dalio warns that countries are becoming reluctant to invest in US debt, citing the weaponization of the dollar by the West to penalize Russia during the Ukrainian conflict. Dalio further expresses concerns about a looming debt crisis in the US, as he believes the government will face challenges in finding buyers for newly issued bonds.
Clever Robot News Desk 16th June 2023