Trump’s advisers consider consequences for countries shifting away from the dollar | Global News

Former President Donald Trump’s economic advisers are reportedly exploring ways to prevent nations from moving away from using the dollar, in response to emerging markets seeking to reduce their reliance on the US currency. Discussions are said to include potential penalties for countries engaging in bilateral trade using currencies other than the dollar, such as export controls, currency manipulation charges, and tariffs.

The pushback against the dollar’s dominance in the global financial system gained momentum in 2022, following the US-led sanctions on Russia, which restricted access to the dollar for Russian entities. President Joe Biden recently signed a law granting him new powers to seize Russian dollar assets to aid Ukraine, a move that has raised concerns among some Republican lawmakers about the dollar’s role in the global financial system.

The Brics nations, along with key oil-producing countries like Saudi Arabia and the United Arab Emirates, have discussed de-dollarization, with the group gaining influence on the global stage. Trump and his economic advisers have reportedly discussed targeting this de-dollarization effort in a potential second term.

While Trump had previously considered weakening the dollar to support domestic manufacturing, he now reportedly sees no merit in intervening in the currency. He has expressed a desire for a stable dollar and criticized Biden’s policies for potentially undermining the dollar’s status as the world’s reserve currency.

Authorities in Japan, South Korea, and China have also expressed concerns about excessive currency fluctuations and have taken steps to stabilize their currencies against the dollar. Overall, the debate over the dollar’s role in the global economy continues to evolve, with various countries and stakeholders weighing in on the issue.