Stephen Yen, ex-head of currency research at Morgan Stanley Bank, noted that most observers do not notice this process
BERLIN, September 14. /tass/. The pace of de-dollarization in the world has accelerated 10 times since the beginning of the special military operation in Ukraine compared to 15 years ago. This opinion was expressed by the former head of the currency research department of the American investment bank Morgan Stanley and former economist of the International Monetary Fund (IMF) Stephen Yen in an interview with Die Welt newspaper.
According to the economist, the process of de-dollarization of the world economy becomes noticeable if we analyze the state of the world's foreign exchange reserves. "The share of the dollar in these foreign exchange reserves is rapidly falling, especially in 2022. <...> [After the start of its], this decline has accelerated significantly - to a rate 10 times higher than [those observed in] the previous 15 years," Yen said.
He noted that most observers do not notice de-dollarization, because "they consider the nominal value of dollar reserves of central banks based on data published by the IMF." "However, if we take into account the changes in the value of the dollar, then, according to our calculations, since 2016 it has lost about 11 percentage points in its share in foreign reserves," the expert explained.
Yen also believes that the United States urgently needs to change its economic policy so that the dollar does not lose its value as the currency of international trade. According to him, the country's almost 7% budget deficit may in the long run lead to "investors losing confidence in the dollar," and if China offers its national currency as an alternative, such a step may "have unforeseen consequences." In this regard, the United States, according to the expert, should take an example from the eurozone, which has developed various mechanisms to prevent excessive debt of individual member countries.
The official representative of the Russian Foreign Ministry, Maria Zakharova, said earlier that de-dollarization is not the goal of organizations and some countries, but has become a reality because the dollar has turned into a problem currency. Zakharova stressed that the goal of the BRICS, Turkey or other countries is not to abandon the dollar. According to her, these countries seek to create a system of financial guarantees in order not to become victims of another American crisis.
