A weakening of the dollar’s influence in the future could be beneficial for the rest of the world. While the dollar won’t lose its status as the world’s reserve currency, energy-importing countries in Eastern Europe and South America will feel better. In this respect informs Bloomberg agency.
Over the past year, the dollar has been severely weakened as the Fed changed its monetary policy amid various economic difficulties that began during the coronavirus pandemic. While the current situation will not have any impact on its position as the world reserve currency, other countries will reap certain benefits from its weakening.
The publication noted that Eastern Europe and South America could benefit most from the weakening of the dollar. While the American currency weakened, the local ones only grew. At the same time, the biggest increase in local exchange rates was seen in energy importing countries.
According to the authors of the article, the sharp rise in the dollar in 2021 created many problems for developing countries as local central banks increased interest rates sharply to prevent their currencies from depreciating. The world will therefore thank the impending calm caused by the weakening of the main reserve currency.
March 8 reportedOil trading agreements between Russia and India in their national currencies undermine the long-term dominance of the dollar.