ING Bank Analysts Predict De-Dollarization Momentum Boosted by BRICS Summit

Analysts from ING Bank are forecasting a potential acceleration of the global de-dollarization trend, particularly due to the upcoming BRICS summit in Johannesburg. 

The bank’s analysts, including Chris Turner, Dmitry Dolgin, and James Wilson, anticipate that the subject of de-dollarization will gain prominence during the summit of the BRICS nations—Brazil, Russia, India, China, and South Africa.

While the issuance of a common currency for the BRICS bloc remains uncertain, the Chinese yuan is emerging as a likely contender to challenge the dominance of the U.S. dollar. Despite mixed statements about a common currency, ING analysts suggest that the BRICS nations might utilize the Chinese yuan as part of their de-dollarization strategy. 

The yuan has gained momentum in bilateral trade agreements within the bloc, including settlements between Brazil, Russia, and China. However, the analysts note that concerns about liquidity and potential capital controls currently limit the attractiveness of the yuan for bond investors.

Clever Robot News Desk 23^rd August 2023