As the BRICS countries talk about making their currency, U.S. Treasury Secretary Janet Yellen has said that sanctions against countries like Russia could hurt the U.S. dollar. Also, foreign trade has been very determined to find a standard currency other than the U.S. dollar.
The BRICS countries have clearly wanted a new currency for foreign trade. On the other hand, Yellen told CNN that economic sanctions against countries like Russia would threaten the U.S. dollar’s dominance.
BRICS: Yellen Discusses Dollar Decline
The BRICS countries, Brazil, Russia, India, China, and South Africa, have grown in importance worldwide and, without a doubt, have seen their recent collective GDP surpass the G7 countries. Also, they have made it clear that they want to make a different currency to eliminate the American dollar’s power.
As the BRICS countries make plans, Treasury Secretary Janet Yellen has discussed how penalties will hurt the U.S. dollar in the long run. In particular, Yellen talked to CNN about these measures and how they could undermine the dollar’s importance worldwide.
In an interview, Yellen said, “There is a risk that using financial sanctions that are tied to the role of the dollar could, over time, weaken the dollar’s hegemony.” In the same interview, she said that the U.S. “judiciously” uses the dollar as a tool.
“It works very well as a tool.” “Of course, it makes China, Russia, and Iran want to find an alternative,” Yellen said. Still, these three are not the only ones speaking out more against the U.S. dollar’s power.
In particular, Brazil’s President Luiz Inacio Lula da Silva said last week that countries should make their currencies so they could trade with each other. So, governments are becoming less dependent on U.S. money.