Catenaa, Monday, May 12, 2-25- A wave of de-dollarization could hit global markets as BRICS nations and Asian economies consider shedding an estimated $2.5 trillion in US dollar reserves, according to financial insights shared with Bloomberg by Stephen Jen, head of Eurizon SLJ Capital. The move is seen as part of a broader shift favoring local currencies over the greenback, which has weakened significantly in 2025.
Recent data from the Bloomberg currency index indicates the US dollar has declined by about 8% since February. This underperformance is encouraging several developing economies to reassess their dependency on the dollar. Analysts at Eurizon suggest that a large portion of dollar reserves, primarily held by exporters and institutional investors across Asia, may soon be released into the market. The scale of these holdings is believed to pose considerable risk to the dollar’s valuation, especially against Asian currencies.
Countries aligned with BRICS—Brazil, Russia, India, China and South Africa—are reportedly more confident in shifting toward regional currencies as their own economies stabilize and grow. Economic strategists believe these nations are now in a stronger position to support bilateral trade without the dollar, benefiting from currency pairings that are free from US debt exposure.
Beyond the BRICS bloc, other nations including Vietnam, Malaysia and Taiwan have also started adjusting their financial strategies by reducing dollar transactions. These moves reflect a growing trend in the Global South to minimize reliance on the US financial system.
Experts warn that if these sell-offs accelerate, the dollar could experience steep depreciation, potentially intensifying existing economic pressures in the US and reshaping global trade relationships. The long-standing dominance of the dollar, they argue, may be nearing a significant inflection point.
