US currency is predicted to lose global supremacy. A central banker thinks that the dollar will lose its place as the most important currency in the world.
Felipe Medalla, head of the central bank of the Philippines, told RIA Novosti on Wednesday that the US dollar’s place as the most important currency in the world will slowly weaken over time.
Medalla called for a world with more than one currency, but he also said that the dollar still has an edge around the world because there is such a big market for US government bonds.
“We want a world with more than one currency, but so far, other currencies don’t have the foreign markets they need to work. “The advantage of the US dollar is that there is a very large market for government securities,” Medalla told RIA on the sidelines of the IMF-World Bank Spring session in Washington.
“I think the dollar will become less important over time,” the central banker said.
De-dollarization is happening in more and more places around the world as more countries look for options to the US dollar. Recently, Vladimir Putin, the president of Russia, said that the dollar and other Western currencies would lose their leading place in global cross-border transactions because the policies of Western countries are making the dollar and euro less important in international payments.
The IMF’s most recent figures show that the dollar’s share of the world’s foreign exchange reserves fell to 58.36% last year, continuing a decline that has been going on for 20 years. The dollar’s share of official foreign exchange reserves went down by 0.44 percentage points, which was the biggest drop of any asset that the IMF tracks.