US Dollar Will Not Lose Prominence 'Anytime Soon' Despite Geopolitical Fragmentation - IMF

WASHINGTON (UrduPoint News / Sputnik - 05th April, 2023) The dominance of the US Dollar is unlikely to recede "anytime soon" despite the ongoing geopolitical fragmentation, IMF Monetary and Capital Markets Department chief Mario Catalan said on Wednesday.

"The dominance of the dollar has no chance of losing its prominence," Catalan said at a panel hosted by the Atlantic Council. "We don't see a chance that this will happen anytime soon.

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Catalan noted that nearly 60% of international reserves are held in US Dollars, down from 71% more than 20 years ago. The IMF official explained that the slow decline has mainly been driven by the introduction of the euro.

Catalan said IMF research has shown that some central banks might reallocate reserves toward gold and reduce currencies in their portfolio during the geopolitical tensions.

However, at the aggregate level, the US dollar will stay dominant, Catalan added.