Dollar to Remain Firm as Primary Reserve Currency: Analysts

The US dollar may have experienced some depreciation amid ongoing global trade tensions, but it is expected to retain its status as the world’s dominant reserve currency for decades to come.

Following Donald Trump’s inauguration, the US Dollar Index surged to nearly 110. However, it soon began to decline, falling below the 100 mark — a slide driven largely by America’s ballooning debt and rising global efforts toward “de-dollarisation,” particularly by the BRICS nations (Brazil, Russia, India, China, and South Africa).

Countries like China have been actively promoting the yuan’s use in international trade and expanding currency swap agreements to reduce reliance on the dollar. Similarly, the European Central Bank has expressed ambitions to elevate the euro’s global role, signaling a push to enhance its international credibility. Yet, no viable alternative has emerged to decisively challenge the dollar’s supremacy.

The resilience of the dollar is underpinned by the unmatched depth and liquidity of US financial markets, strong global confidence in American institutions, and widespread adoption of dollar-denominated assets by central banks around the world.

Still, some cracks are beginning to show. The dollar’s share in global foreign exchange reserves has edged down to just under 60% as of 2025 — a modest decline that, while notable, is not seen as a signal of rapid displacement.

Analysts cited in a recent report by Al Jazeera suggest the global financial system is gradually evolving toward a more multipolar structure, with currencies such as the euro and yuan expected to play expanded roles. However, they agree that no single currency is currently positioned to replace the dollar in the near future.