aichengreen176_Andrey SuslovGetty Images_digitalbank Andrey Suslov/Getty Images

Will Geopolitics or Technology Reshape the Global Monetary Order?

China was supposed to be the main beneficiary of a shift away from the dollar by countries fearing its "weaponization" by US authorities. So why isn't diversification toward the renminbi visible in data on foreign reserves and international payments?

BERKELEY – When the United States and its G7 partners imposed sanctions on Russia’s central bank and barred Western financial institutions from doing business with Russian counterparties, commentators warned of far-reaching changes in the global monetary and financial order. Other countries would see those sanctions as yet another step in the West’s “weaponization” of finance. Fearing that they, too, might one day be on the receiving end of sanctions, governments and central banks would reduce their dependence on the dollar, US banks, and the US-dominated Society for Worldwide Interbank Financial Telecommunication (SWIFT).