- The biggest risk of de-dollarization is that the US could lose a key tool it’s used to fight past crises, JPMorgan said.
- De-dollarization risks mostly relate to inflation and debt burdens, strategists said.
- The dollar’s dominance has helped Western central banks employ monetary and fiscal measures during crises.
The biggest risk of de-dollarization isn’t a rival currency — it’s that the US could lose a key tool it’s used to fight past economic crises, according to JPMorgan.
According to a note on Tuesday, strategists led by Marko Kolanovic said de-dollarization risks are unlikely to mean emerging powers will suddenly stop using the dollar or replace it with another currency.
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