Don’t believe it? Then take a look at the work of Robert McCauley (University of Oxford) and Hiro Ito (Portland State University). The economists examined the impact on America’s position of the freezing of the Central Bank of the Russian Federation’s (CBRF) currency reserves, which occurred after Putin’s aggression against Ukraine began.
Many commentators predicted that we were dealing with the decline of the dollar as the global reserve currency. It was expected that since during the first 20 years of the 21st century the baks were replaced (not very quickly) by other currencies (euro) in the exchange balances of the rest of the world, now, after the outbreak of the first superpower conflict of our time, the situation with the dollar would only get worse. It was expected that the seizure of foreign currencies belonging to the CBFR would discourage non-Western countries from keeping their reserves in the dollar, which would then switch to, for example, the renminbi or gold and, ultimately, to the euro and pounds. Such a triggered mechanism was supposed to be the beginning of the end of the “supernatural privilege” that the currency with images of American presidents had enjoyed since World War II. The effect of this bonus has been to give the US an advantage in every domain (from technology to military) due to the fact that the demand for the money they produce with a click (because that is how fiat money is produced today) will never end. Because it simply cannot end.
McCauley and Ito’s findings show that no change has occurred since 2022. In the first quarter of this year, 58.8 percent of the world’s foreign exchange reserves were held in US dollars. And this is exactly the same as in the fourth quarter of 2021 – the last period before the start of the currency confrontation with Putin’s Russia. Between these two dates, the share of the USD in global reserves fluctuated between 57-60 percent. Therefore, we can safely say that we have a constant here. Neither China nor the BRICS countries have started to abandon the “greens”.
