In the wake of a massive plethora of sanctions imposed on Russia that blocked the country’s access to its foreign reserves in other countries, several prominent experts in finance and investments from world-renowned institutions such as IMF, Credit Suisse, and others, voiced their opinion warning that such sanctions are a direct path to undermining the hegemony of the US currency and splitting the global financial system into several competing blocks.
In an interview with a prominent, Russian-based daily periodical Izvestia, Investment Director of Sigma Global Management Vladislav Petlenko also shared his view on the situation.
The expert noted that the share of the dollar in international settlements, as well as a world reserve currency, has been gradually dropping over the years. The share now stands at about 60%. Some 70 central banks around the world already hold the yuan as a reserve currency. Australia, Japan, as well as several African countries, and some countries in the Middle East regularly use the Chinese yuan in their payment transactions.
“Recent events may accelerate this drop, and when the share of the dollar in international tumbles reserves below 40%, a transformation process may indeed begin as the dollar-denominated sanctions pressure on international settlements will not suit many countries,” pointed out Petlenko.
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