Are the US dollar’s days really numbered?

Are the US dollar’s days really numbered?

From omfif.org

Questions about whether President Donald Trump’s tariffs spell the end of dollar dominance and the safe-haven status of US Treasuries elicited tremendous hand-wringing by market participants and officials at the International Monetary Fund-World bank spring meetings. And rightly so. But while critical and legitimate concerns have been raised about Trump’s chaotic actions and policies, and recent developments may indeed be setting in motion a gradual decline in dollar dominance, the hand-wringing is overdone. Since Trump’s disastrous tariff rollout, financial markets have understandably been on edge. A risk-off ... (full story)

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Apr 29, 2025 1:24pm — Edited

Quoting althar

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The days of the USD as the world's reserve currency, yes. I hope no one thought the USD would remain the global currency forever.

Ignored

What’s forever ?

Everything is transient , just ask the Fed .

It’s all about perspective . The US will lose its hegemony and, if I were to hazard a guess, I’d say China would step into that role .

That’s what this charade ( tariffs ) in essence, is all about .

Ask yourself this simple question :

Are things going to get better ? - to use a simplistic term . Is the economy going to improve, or has the potential to improve- short term, medium term?

There’s too many variables and unknowns to even contemplate saying “ yes to either .

Vancarbon

Apr 29, 2025 2:08pm

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Quoting AaronWard

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Without question, over the next 10 years, the dollar will lose some control, but this will be a slow process. Institutions tend to die slowly. The geopolitical factors are straightforward. People and countries using Swift have a risk of their assets being frozen. The dollar is pretty volatile, so a hedge is required. Using the dollar as the middleman in exchanges adds a layer of expense that can be removed. Invisible transactions with Bitcoin et al are becoming increasingly attractive to many American "enemies" who don't want their actions...

Ignored

Exactly Aaron .

All variables, which require consideration . If you then throw into the mix the agenda of the administration , you have a turbulent few years ahead .

AaronWard

Apr 29, 2025 1:48pm

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Without question, over the next 10 years, the dollar will lose some control, but this will be a slow process. Institutions tend to die slowly.

The geopolitical factors are straightforward. People and countries using Swift have a risk of their assets being frozen. The dollar is pretty volatile, so a hedge is required. Using the dollar as the middleman in exchanges adds a layer of expense that can be removed. Invisible transactions with Bitcoin et al are becoming increasingly attractive to many American "enemies" who don't want their actions traced. The US wants to become a manufacturing power again, and a strong currency will make this dream far more difficult. The list goes on.

However, count out 10 years on your fingers and then imagine where you will be then. Then think about how you currently trade. I doubt anybody here is trading on a 10 year horizon. A weaker dollar does not generate any meaningful trading signals.