Finance’s Addiction to Dollars Leaves World Vulnerable to U.S.
- Dollar accounts for nearly 50% of global funding, BIS says
- Demand is driven by market-based funding, not bank lending
A pressman aerates a stack of uncut sheets of $1 dollar notes at the U.S. Bureau of Engraving and Printing in Washington, D.C.
Photographer: Andrew Harrer/BloombergThis article is for subscribers only.
The U.S. dollar’s growing dominance in international finance means that American problems can quickly pose a threat to the entire world.
That’s one takeaway from a report by a committee at the Bank for International Settlements, which noted that the greenback’s share as an international funding currency has grown to levels not seen since the early 2000s. Stresses in global funding markets earlier this year as the coronavirus began harming the U.S. economy highlight how easily a dollar-related shock can spread.