US Dollar To Remain Anchor Currency for Central Banks

It seems that the US dollar can see better days ahead. Check out the latest reports about this below.

Chamath Palihapitiya, a billionaire, firmly believes that the US dollar will continue to hold its status as the world’s reserve currency, despite the BRICS nations’ attempts to move away from it.

On the most recent edition of the All-In Podcast, Palihapitiya highlights the fact that despite the declining interest in US government debt across the globe, central banks worldwide continue to make substantial investments in US dollars.

The chart shared by the billionaire, sourced from the International Monetary Fund (IMF), highlights that the US dollar has been a major component of central banks’ foreign exchange reserves, ranging from 60% to 70% since 1999.

“If you look at the IMF data… you can’t just look at US treasury securities. You have to look at actual absolute dollar reserves.”

He continued and said the following:

“When you look at that over time, it hasn’t fluctuated that much. So for all the dopes that don’t understand how this sh** works, it’s not just securities. It’s actually also money and the actual amount of US dollar money hasn’t changed that much.”

According to Palihapitiya, even though BRICS nations are looking for other currencies for trading, foreign governments and central banks will continue to gather US dollars in the coming times.

“Foreign reserves are up. These guys are banking US dollars like nobody’s business… What I’m saying is that in general, the anchor currency for governments and central banks has been, will be and will likely be in the future the United States dollar.”

The billionaire holds the belief that, despite BRICS and other nations’ efforts to conduct trades using yuan, the dollar will continue to be the leading currency.

“I think you guys keep forgetting this key thing, which is the yuan is pegged to the US dollar, so it is a proxy dollar.”