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Home NewsLatest News BRICS Using Gold to Shift Global Demand Away From US Dollar

BRICS Using Gold to Shift Global Demand Away From US Dollar

by bitcoinews.us


Throughout 2023, the BRICS alliance has acquired gold at a remarkable rate. Central Bank throughout the alliance has sought to stock up on the metal, with many assuming that it was for an impending BRICS currency announcement. However, Forbes has recently reported that the BRICS bloc is using gold to help shift global demand away from the US dollar.

Indeed, the alliance is not relying on gold to be a currency used in place of the dollar. Yet, they are acquiring the asset so that it could be used “as the basis for international exchange,” similar to the dollar. Susbeuqnlety, denominating in this asset is an effective way to maintain its local currency strength but redirect global activity away from US Dollar reliance.

brics leaders meet
Source: AFP

Also Read: Comparing BRICS GDP vs G7 Countries

The BRICS Bloc Gold Acquisitions Play Key De-Dollarization Role

For all of last year, the BRICS alliance has made impressive strides in de-dollarization plans. Indeed, the alliance has sought to continually shift global finance away from the US dollar. It has used local currency promotion and even worked toward developing its native trade currency. However, a Forbes report has highlighted how one asset is playing an underrated role in that endeavor.

Specifically, Forbes has stated that the BRICS alliance is using gold to facilitate a shift in global demand away from the US dollar. Indeed, they are not relying on the asset as an actual trade currency or the basis for its native currency. Instead, they are seeking to use different investment vehicles that are denominated in gold.

Where this becomes effective is that it replaces a lot of these financial vehicles that had been denominated in the US dollar. Subsequently, the alliance does not have to increase the prevalence of its currency to replace the dollar. However, they can denominate enough investment vehicles denominated in a commonly valued asset in place of the greenback.

usa russia flags countries brics
Source: Freepik

Also Read: BRICS: Why Local Currency Bonds is a Blow to the US Dollar

For many, placing the Ruble, yuan, or rand in place of the dollar is a hard sell. So, the search for alternatives has been ongoing. Some BRICS countries, like Russia and Iran, are unable to operate in dollars. Other BRICS nations are in fear of similar sanctions. So, gold has emerged as a potential supplement.

Therefore, various countries around the world are also acquiring gold, but why? Well, the answer lies in business opportunity. As Forbes states, these countries are “making sure they have a seat at the table,” to do business with the BRICS Nations.

The path toward de-dollarization may not run through a single nation’s currency. If they can continue record gold acquisition, they may be able to shift the global perspective. Moreover, it could ultimately create a landscape that has not been present globally since 1944.



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