Challenging dollar’s dominance

Strengthening ties and cooperation with regional countries, promoting platforms like BRICS and focusing on trade in local currencies may challenge the dominance of the US dollar in the coming years on account of a changing world order. At present, the US has technological, economic and political dominance across the globe. The potential diversification of foreign exchange reserves can help avert the impact of volatility in the US dollar and with the changing world scenario, countries such as Pakistan need to strengthen regional trade ties. Trade with Central Asia and the Middle East via the China-Pakistan Economic Corridor (CPEC) could benefit Islamabad to a great extent. A recent KTrade economic insight report titled “Assessing the Future Trend of the US Dollar & Global Currency Flows,” provides a comprehensive analysis by examining the dollar’s dominance as a store of value, a safe haven and a reserve currency on the global stage along with predicting the future global financial system. It seeks to assess the potential of emerging challengers such as BRICS-plus nations to rival the dominant position of the US dollar. It also stresses the significance of the international transactions carried out by various economies in local currencies, rather than the dollar.