BRICS is persuading developing countries to eliminate the US dollar and trade in local currencies to strengthen their local economies.
The US Federal Reserve (Fed) has finally responded to the BRICS de-dollarization agenda and reassured Americans that the USD remains strong despite challenges - Watcher.guru said.
Fed Governor Christopher Waller admitted that the BRICS de-dollarization campaign has developed larger but has not affected the USD.
Mr. Waller reassured the American people that there is no need to worry because the greenback is still the most used currency in the world in all transactions, despite the threat of de-dollarization.
Fed Governor Christopher Waller mentioned BRICS's de-dollarization in his opening speech at a US dollar conference last week. After his speech, Mr. Waller emphasized that the US dollar is actually still the world's reserve currency and the dominance of the greenback has not ended.
To date, the US dollar remains the most widely used currency by some measures. There have been comments predicting that the US dollar will collapse even the possibility of collapse Waller said.
The Fed governor assured the US that the US dollar is gaining strength and outperforming all major currencies despite the threats of de-dollarization from BRICS. However, he acknowledged that recent developments that some have warned could threaten the USD's position, while acknowledging that BRICS' de-dollarization efforts are getting stronger, at least for now.
The Fed governor is cautious about BRICS' de-dollarization process but believes the USD can overcome the challenge. According to Governor Waller, the greenback is the most used currency in the world and its removal will only hurt BRICS and other countries.
BRICS currently consists of 10 members: Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates (UAE). Member countries are considering forming a BRICS common currency to replace the USD.
Russia and Iran announced that they would start using BRICS currencies on the day of launch and remove the USD from trading. Both Russia and Iran are facing US sanctions and are therefore looking to stay away from the US dollar.
"Creating a new currency within the BRICS framework is something that Russia and Iran are working towards," said Iranian Ambassador to Russia Kazem Jalali.
According to the Ambassador, more than 60% of trade transactions between Russia and Iran are currently paid in rubles and rials. This shows that Russia and Iran will switch to BRICS currency as soon as it is launched on the market.
However, the expected launch date of the BRICS common currency has not been determined. BRICS is in the process of planning and deciding on a common currency. The 16th summit in October could decide the fate of the BRICS currency.
