That has the Fed keeping a close eye on the risks of de-dollarization and how it could impact American consumers and businesses.
“There has been for some time been commentary predicting that the dollar is destined for demise–potentially an imminent demise,” Fed Governor Christopher Waller said Monday in opening remarks at a conference on the international role of the U.S. dollar.
For well over half a century, the dollar has been the world’s de facto “reserve currency,” the default currency held in central bank reserves and the dominant currency in foreign exchange markets: The U.S. dollar appears in over 90% of forex transactions. The dollar’s global dominance is an “exorbitant privilege” for the U.S., in the words of Valery Giscard d’Estaing, president of France in the 1960s.
But if the recent uptick in commentary arguing that the dollar’s era of…
