International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on Monday (May 1) that a shift away from the US dollar is occurring at present, but she does not see an alternative to the dollar as a world reserve currency in the foreseeable future.
“The reason the dollar plays its role is the strength of the US economy, the depth of the capital markets here. And if you are thinking of an alternative, in a world in which we may migrate to CBDCs [central bank digital currencies] massively, there could be different propositions, but ultimately the strength of the US economy, the depth of the capital market, the ability to present that trust in the currency is going to be the leading factor. And there I do not see an alternative, I don’t see it coming any time soon,” Georgieva said in remarks at the Milken Institute in Beverly Hills, California.
The IMF chief said the standing of the US dollar and de-dollarisation are not on the list of issues that she worries about.
“The biggest competitor to the dollar is the euro, it has taken some space. Everybody else — the pound, the yen, the RNB — they play a very modest role,” Georgieva said.
In recent years the ‘de-dollarisation’ movement has gained momentum as various countries seek to end their dependence on the US currency.