BRICS Challenge: Is the US Dollar Sliding 10 Times Faster Than in the Last 2 Decades?

The global financial landscape is undergoing a seismic shift, with the US dollar's dominance facing unprecedented challenges. Reports indicate the dollar’s share of global reserves is shrinking at a rate ten times faster than in the previous two decades. This raises serious questions about its future as the world's reserve currency, especially given the growing influence of BRICS.

BRICS Pushing for De-Dollarization: A Real Threat?

BRICS, an association of major emerging economies, is pushing for a significant shift away from dollar dependency. Their strategy involves a combination of local currencies for international trade. By BRICS is calling on oil producers to ditch the dollar, and the strategy is starting to bear fruit.

The Numbers Speak Volumes: Dollar's Market Share Declining

The data paints a concerning picture for the dollar. Since 2025, the dollar lost nearly 11% of its market share. This decline is fueled by developing nations’ replacing the USD for international trade, picking up steam making the dollar weaker on the global stage.

Economic Factors Contributing to the Dollar's Weakness

There are plenty of fundamental economic reasons to hold a long term negative view on the U.S. dollar. These factors, combined with geopolitical shifts, are accelerating the erosion of its long-held position.

The Risks of Challenging the US Dollar

Upsetting the U.S. government could mean retaliatory measures in the form of a freeze on a country’s dollar holdings. This potential risk highlights the complex geopolitical considerations involved in moving away from the dollar.

Is There a Viable Alternative to the Dollar?

While competitors are pushing the limits of autonomy within a dollar-based system, but there isn’t a real global alternative and the world is far from an inflection point. Despite these challenges, the momentum for de-dollarization is growing.

Expansion of BRICS: A Game Changer?

Given the recent expansion of the “BRICs” countries to include five new members, will the US dollar remain the world’s reserve currency? Franklin Templeton and other financial analysts are closely monitoring this development, as it could significantly impact the global financial order. U.S. President-elect Donald Trump has warned the world on challenging US interests.

The future of the US dollar remains uncertain, but the trends are undeniable. The BRICS nations' push for de-dollarization, coupled with underlying economic factors, is creating a challenging environment for the world's reserve currency. Whether the dollar can withstand these pressures remains to be seen.