Dollar’s dominance at risk, says US Treasury Secretary Janet Yellen

Washington: Dollar’s dominance as the global reserve currency is at risk as Russia and other countries, on which US has imposed sanctions, are seeking an alternative, said Treasury Secretary Janet Yellen. Is the dollar hegemony at risk? In an interview to CNN, the US Treasury Secretary said: “There is a risk when we use financial sanctions that are linked to the role of the dollar that over time it could undermine the hegemony of the dollar.” “Of course, it does create a desire on the part of China, of Russia, of Iran to find an alternative,” she said. “But the dollar is used as a global currency for reasons that are not easy for other countries to find an alternative with the same properties,” Yellen said. But why sanctions? After expressing fears on dollar’s world dominance, Yellen said that sanctions are an “extremely important tool,” all the more so when used by the US and its allies as “a coalition of partners acting together to impose these sanctions.” The robust US capital markets and rule of law “are essential in a currency that is going to be used globally for transactions,” the US Treasure Secretary said, adding: “And we haven’t seen any other country that has the basic… institutional infrastructure that would enable its currency to serve the world like this.” De-dollarization It appears that King dollar is on verge of losing the crown. The Indian government, last month, said that as many as 18 countries - including Russia, Sri Lanka, UK - have expressed interest in settling overseas trade with India in Indian rupee or INR. Must Read: Rupee closer to replacing dollar as 18 nations agree to trade in INR Recently, India announced it had signed an agreement with Malaysia to start trading in INR.

Iran has completely abandoned dollar trade with China and Russia. Saudi Arabia, a key OPEC member, said it will completely give up PetroDollar and will start accepting PetroYuan. Returning from his visit to China, French President Emmanuel Macron last week said that he believes that Europe should avoid getting caught up in a conflict between the US and China, and reduce its reliance on the US dollar to avoid becoming “vassals,” applying his concept of “strategic autonomy.” Last week, Brazil President Luiz Inacio Lula da Silva, who was on his first state visit to China since taking office in January, had called for the BRICS nations to give up US dollar and come up with their own alternative currency to settle cross-border trade. His comments came mere days after the Brazilian government ditched dollar as an intermediary and announced a deal to trade in local currency with China. Don’t Miss: End overseas trade settlement in dollar, use your own currency: Brazil President Lula to BRICS nations Meanwhile, China is actively trying to present Yuan as an alternative to US dollar. Russia too has been largely using Yuan in international trade. It is also mulling launching a joint BRICS currency. Recently, former US president Donald Trump posted on his “Truth Social” media platform saying, “China is trying to displace the US dollar as the NUMBER ONE CURRENCY throughout the world. Unthinkable three years ago! If this happens, and under Biden’s leadership it probably will, this would be the biggest defeat for our Country in its history. We will be reduced to SECOND TIER SATUS. AMAZING. MAKE AMERICA GREAT AGAIN!” Also Read: Dollar Decoupled: Donald Trump warns US currency 'crashing, will no longer be the world standard' Also, Brazil and Argentina, two biggest economies in South America, announced in January this year that they have been preparing for a common currency called the “sur”. Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.