Global De-Dollarization Trend Accelerates as JPMorgan Warns of Economic Shifts

The US dollar's dominance in global reserves has slipped below 60% for the first time in two decades, marking a pivotal moment in the de-dollarization trend. JPMorgan Chase reports a $59 billion decline in dollar-denominated securities held by central banks in 2024 alone, with the dollar's share of global reserves now at 57.8%—the lowest since 1994.

Emerging markets are driving this shift, with 71 countries actively diversifying away from the dollar. Gold has emerged as a preferred alternative, with central bank holdings more than doubling to 9% over the past decade. "When currencies waver, gold speaks," observes one analyst, highlighting the metal's resurgence as a hedge against dollar volatility.

JPMorgan's warning underscores the strategic implications: the 7.3% decline in dollar reserves over the past decade mirrors the currency's 14.2% drop from its 2002 peak. This recalibration of global reserve assets signals potential turbulence for dollar-denominated markets and traditional financial systems.