The financial supervisory authority in Berlin has warned against \u201cdrastic attempts to politicize institutions\u201d<\/p>\n
The US dollar\u2019s status as global reserve currency could be called into question as early as this year, the German financial regulator has warned in its annual forecast. According to a report published on Wednesday by the Federal Financial Supervisory Authority (BaFin), the dollar could suffer from funding shortages, geopolitical shocks, and politicization.
\nThe forecast follows the dollar\u2019s worst single-day decline in nearly a year. On Tuesday, the Bloomberg Dollar Spot Index, a key indicator of its strength against other major currencies, recorded its steepest drop since last April, when US President Donald Trump rolled out his sweeping global tariffs agenda.
\n\u201cThe risk remains that markets will question the role of the US dollar as the global reserve currency,\u201d BaFin President Mark Branson said. He warned that \u201cdrastic attempts to politicize institutions\u201d could undermine the effectiveness of international cooperation, particularly during an economic or financial crisis.<\/p>\n
Read more<\/p>\n
Traders placing record bets on dollar collapse \u2013 Bloomberg<\/p>\n
The agency also expressed concern over potential \u201cliquidity shortages\u201d caused by geopolitical shocks, calling it a risk \u201cof particular importance.\u201d
\nThis week, Bloomberg reported that traders were betting heavily that the US dollar would continue to fall amid uncertainty over Washington\u2019s policies. According to the outlet, markets were more pessimistic about the dollar\u2019s long-term outlook than at any point since May 2025. Trump earlier dismissed concerns over the currency\u2019s weakness, insisting it is \u201cdoing great\u201d and that he wants the dollar to \u201cjust seek its own level.\u201d<\/p>\n
READ MORE: The dollar is tanking and Trump seems unfazed. Does that make sense?<\/p>\n
The IMF reported in October that the dollar\u2019s share of global foreign exchange reserves fell to a three-decade low of 56.3% of allocated reserves between April and June last year. However, it attributed the decline to currency valuation moves rather than intentional sell-offs by central banks.<\/p>\n","protected":false},"excerpt":{"rendered":"
The financial supervisory authority in Berlin has warned against \u201cdrastic attempts to politicize institutions\u201d The US dollar\u2019s status as global reserve currency could be called into question as early as…<\/p>\n","protected":false},"author":1,"featured_media":27733,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[4,6,3],"tags":[],"class_list":["post-27732","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-environment","category-politics"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/posts\/27732","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=27732"}],"version-history":[{"count":0,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/posts\/27732\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=\/wp\/v2\/media\/27733"}],"wp:attachment":[{"href":"https:\/\/mongolianews.mn\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=27732"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=27732"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mongolianews.mn\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=27732"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}