An October 1 report issued by the International Monetary Fund took note of the fact that the U.S. dollar accounted for 56.3% of world reserves between April and June of 2025. The dollar share has been systematically dropping, and the latest fall is 1.5 percentage points below that of the previous quarter, and the lowest share since 1995. The IMF report tried to soften the blow by explaining that “Exchange-rate effects drove nearly all the decline in the US currency’s share of foreign exchange reserves,” accounting for 92% of the fall. The dollar dropped 9% against the euro, 11% against the Swiss franc, and 6% against the pound sterling in the period.
But the devaluation of the dollar is itself a reflection of the same underlying dynamics driving the reduction in reserve shares: people and countries not wanting to hold dollars, in light of Washington’s toxic economic and financial policies.
RT explained: “In the first half of 2025, the dollar fell more than 10% against major currencies, marking its worst start to a year since 1973. The recorded downturn contrasted with the dollar’s traditional role as a safe-haven asset.”
This situation could escalate dramatically if the U.S. and other Western countries use frozen Russian assets, according to Jacques Sapir, veteran economist and director of studies at the Paris-based School for Advanced Studies in the Social Sciences, according to remarks reported by Sputnik. The first reaction could be “widespread distrust of countries that commit what can be called a crime,” Sapir stated. He said this could extend to the euro as well. “The loss of credibility would cause a rapid split in financial spaces, and in particular in the debt market, whether public or private,” Sapir pointed out. This would lead to sharp rises in interest rates, and the creation of alternatives to the SWIFT system.
