Federal Reserve Chair Discusses De-Dollarization Threat, Risk of US Dollar Losing Reserve Currency Status

Federal Reserve Chairman Jerome Powell has discussed the menace of de-dollarization and the hazard of the U.S. dollar losing its world’s reserve currency status. He believes that the USD hegemony is simply a effect of America’s economical dominance.

Fed Chair Powell connected Threat of De-Dollarization, USD Losing Reserve Currency Status

Federal Reserve Chairman Jerome Powell addressed de-dollarization concerns during his grounds earlier the House Financial Services Committee connected Wednesday.

Congressman Ritchie Torres (D-NY) asked the Fed chair: “As you know, the U.S. has overseas adversaries, peculiarly the CCP, that look intent connected de-dollarization. How earnestly should the menace of de-dollarization beryllium taken successful your view?”

Powell replied: “The presumption of the United States, of the dollar arsenic the world’s reserve currency, is simply a precise important happening to us.” He added:

I deliberation the crushed we person that presumption is mostly owed to our large antiauthoritarian institutions, the regularisation of law, and the information that we have, mostly speaking, had beardown levels of terms stability.

“And, I deliberation the dollar volition stay the reserve currency arsenic agelong arsenic those things are successful place,” helium opined.

The lawmaker further asked Powell whether helium thinks the U.S. dollar’s planetary reserve currency presumption is “the origin of America’s economical dominance oregon a effect of it. The Fed seat replied:

To me, it’s much of a consequence.

“Also determination tends to beryllium an equilibrium wherever 1 currency becomes the accepted planetary modular and that has been the dollar for immoderate time, and I expect that it will, for immoderate time, proceed to be,” Powell further explained.

Some radical disagreed with the Fed chairman. Economist Peter Schiff, for example, tweeted: “Powell is wrong. The dollar’s reserve currency presumption was primitively a effect of America’s economical dominance, but it has since go the main prop upon which that economical dominance present rests. Once the dollar’s reserve presumption is lost, U.S. economical dominance volition topple.”

Meanwhile, a increasing fig of countries worldwide are ramping up their de-dollarization efforts, including members of the BRICS economical bloc and members of the Association of Southeast Asian Nations (ASEAN). The BRICS besides has a connection for a communal currency that is expected to beryllium discussed astatine the group’s upcoming leaders’ summit.

What bash you deliberation astir the statements made by Fed Chair Jerome Powell regarding de-dollarization and the U.S. dollar’s reserve currency status? Let america cognize successful the comments conception below.