U.S. Treasuries, which were the world’s largest reserve asset, have now been overtaken by gold, which now makes up 27 percent of global reserves.
Central banks are already buying gold at a reserve pace instead of allocating dollars as they did for several decades. U.S. assets were the ultimate global safe haven, but now China is seeking to expand the yuan’s role in the global financial system. And not only China — BRICS countries are also trying to reduce their dependence on the dollar.
Clearly, the Iran conflict, the rising long-term U.S. debt, and uncertainty around President Donald Trump’s tariffs are taking their toll.
Although the world has not yet abandoned the dollar, the search for alternatives is accelerating.
