An OMFIF survey of 74 central banks shows for the first time more institutions
plan to reduce dollar allocations than increase them over the next decade,
reflecting diminished dollar appeal amid rising U.S. political and geopolitical
risk and greater U.S. trade-policy uncertainty. The dollar still represents
about 58% of global foreign-exchange reserves and remains dominant in the near
term. A record share of visitors intend to increase gold holdings to hedge
geopolitical and financial-system risk. The euro and the renminbi are gaining
traction for international trade and reserve diversification, and some
emerging-market currencies are drawing interest, signaling gradual reserve
diversification while the dollar’s marginal advantage declines.
