The De-dollarization What’s The Factors Accelerating This Trend In Macro Economic Situation
What’s really this trend of de-dollarization on top gear since the BRICS concluded to do without the dollar influence in their individual trading activities, in a session with the macro guru expert Lyn Alden which she says that one of the factors that is propelling this movement is that most counties are gradually losing trust in the US government bonds.
Why is this so well she buttress her point by saying that this past year you’ve seen a little more acceleration in de-dollarization, and there are, I think, two big underlying foundations for that.So number one is that ever since the global financial crisis and a few years after that, a number of countries decided that (US) treasuries are probably not going to be attractive. And they don’t want to finance the US government at negative real yields.
For much of the 2010 decade, for example, T-bills were yielding less than inflation. Longer-duration treasuries were yielding roughly in line with CPI (consumer price index)… And they were underperforming other assets like equities and real estate and things like that.So a lot of these governments said, ‘We don’t really want to facilitate that.
Another reason is also the role that the US government played during the Russia economic sanctions, which putting other countries in fear that their dollar reserves might be seized any point in time.
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