The views of experts and academics on the future state of the US dollar varied. While some say that it will weaken gradually or that its weakness will accelerate, others say that it will remain so strong that it will become the only stable international currency in circulation.

The writer Hee Jan says in an article on the "Modern Diplomacy" website that Western economic sanctions against Russia had an impact on the global economic, commercial and financial systems in a way that raised concerns in the market and academia regarding the modification of the global financial system, and added that one of the main issues that Subject to discussion is the case of the US dollar.

He pointed out that Gita Gopinath, the first deputy director general of the International Monetary Fund, warned that these sanctions may gradually weaken the role of the US dollar in the world, and this will lead to further fragmentation of the international monetary system.

Analysts such as Christina Tesari, an economist at Goldman Sachs, said the actions of Washington and its allies to freeze the Russian Central Bank's foreign exchange reserves have raised fears that countries may start dumping the dollar due to concerns about the strength that America can mobilize from the dominance of the currency. .

Kenneth Rogoff, professor of economics at Harvard University, said in an interview with Bloomberg that the dominance of the dollar may end within 20 years, and the reason is that “weaponizing the dollar” will stimulate the acceleration of alternative solutions by other countries, adding that the strength of sanctions against Russia may lead to an acceleration Changes in the international financial system to compete with the US dollar.

While this certainly won't happen overnight, Rogoff said, what could have taken 50 years may now only take 20 years to achieve.


The dollar's share in the market

This narrative appears to be supported by data changes in the dollar's position in global markets.

According to the latest currency formation data of official foreign exchange reserves issued by the International Monetary Fund, global foreign exchange reserves denominated in US dollars amounted to 7,087 trillion US dollars in the fourth quarter of 2021, with a market share of 59.15% in the third quarter that had fallen to 58.81%, The dollar's share of the world's reserve currency reached 72% at the turn of the century.

On the other hand, expert Chan Kong believes that the continuation of the global situation in the current trend of development will highlight the US dollar in the world, and if there are no fluctuations in exchange rates resulting from inflation or emergency, the US dollar will be in a unique position when compared to the major currencies in the world.

The difference lies mainly in the diversity of opinions on the impact of the geopolitical event of the war in Ukraine, as Professor Rogoff believes that the dollar has decreased in terms of market size, and that new alternatives to currencies will appear, and this is weakening the position of the dollar.

However, Chan Kong believes that alternatives to the US dollar cannot succeed because the market for these alternatives is weak, their social economy is turbulent, and some are still in war zones.

For these reasons, the US dollar will remain strong, even becoming the only international stable currency in circulation.

In general, geopolitical factors play an important role in global currencies, and the dollar will support them.


greater prosperity

In his article, "Preparing for an Age of Economic Deficit," Chan Kong pointed out that during a period of economic uncertainty the Anglo-American Axis countries might be safer havens in the face of geopolitical turmoil, and believed that once the geopolitical war was resolved in Europe would emerge the maritime countries and the economy of the continent. America again.

From the perspective of the spatial pattern of the world, conflicts and races are most intense in the continental region of the world, i.e. the continental region where Europe, Russia, the Middle East, Central Asia, China and India are located.

It will be difficult to create buffer zones between them, and then there are direct collisions with each other.

In contrast, the geographical location of the Anglo-American axis is in the middle of the ocean, and the Atlantic and Pacific routes connect the American continent with a large number of island countries and regions of different sizes, and there are often oceanic divisions between them.

Historically and relatively less intense hostilities exist between these parts of the world, and they are commercially dependent on each other.

So, while the continental regions are experiencing violent turmoil, the Anglo-American axis, the maritime states, and the Americas have more outstanding opportunities for development and greater prosperity than ever before.