Tehran and Moscow have accused Washington of undermining its own foreign currency, as President Donald Trump hailed its strength on Monday, Newsweek informed.
Criticizing the Federal Reserve for considering a new interest rate hike, Trump said the U.S. dollar was “very strong” and there was “virtually no inflation.” The President’s comments came just after a spokesperson for Iran’s foreign ministry and his Russian counterpart called out Washington for implementing policies that hurt the dollar’s international standing.
“Long-term faith in the dollar is undermined. Today everyone starts thinking of how to get rid of the dependence on the dollar,” Russia’s Sergey Lavrov said in a radio interview, Tass news agency reported. Lavrov also noted U.S. sanctions targeting rivals and allies alike for decreasing global confidence in the currency.
Bahram Qasemi, a spokesperson for Iran’s foreign ministry, made similar remarks like Lavrov. “The White House’s policies as well as the problems caused by the role of dollar in financial exchanges, which is used as a political tool for some countries, have made countries conduct their economic collaborations in their national currencies,” he said, IRNA reported.
The U.S. dollar has long been the world’s top reserve currency and remains key to international trade – but that dominance appears to be slipping, and even allies in Europe have been pushing to move away from the currency’s hold on markets, according to Quartz. Many analysts and some nations have accused the United States of using the dollar as a weapon.
Since the Trump administration renewed sanctions on Iran earlier this year, Europe has moved to create a “special-purpose” financial institution to circumvent punitive financial measures imposed by Washington. “The dollar is not the only currency on earth – we have the euro; others have their own currencies,” Federica Mogherini, the European Union’s foreign minister, said when announcing the plan in September.
Data from the International Monetary Fund showed that the dollar’s popularity as a reserve currency was waning. Although it still makes up the lion’s share (62.5 percent) of global reserves, that amount has fallen sharply from a high of nearly 73 percent in 2001, Newsweek noted.