The Economics Show Martin Wolf talks to Kenneth Rogoff: Trump is accelerating the dollar’s decline
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May 5, 2025 
Kenneth Rogoff, a Harvard economics professor and former IMF chief economist, discusses the US dollar's slow decline and Trump's trade policies. He delves into how the dollar's weakening may empower China and lead to capital flight from the US. Rogoff highlights the surprising threat cryptocurrency poses to dollar dominance, suggesting it could disrupt traditional currency dynamics. The conversation also touches on the need for fiscal stability amid turbulent economic conditions, making it a must-listen for those curious about the future of global finance.
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Trump Accelerates Dollar Decline
- The US dollar has been in gentle decline since 2015, losing some market share but still holds an exorbitant privilege.
- Trump acts as an accelerant, potentially hastening the rise of the euro and renminbi against the dollar.
Global Distrust in Dollar Reserves
- Other countries, especially China, are reconsidering their heavy reliance on the dollar due to US actions like sanctions against Russia.
- This undermines confidence in dollar reserves and is prompting nations to diversify away from the dollar.
Dollar Dominance Decreasing Since 2015
- The dollar's dominance has decreased since its 2015 peak across measures like trade invoicing and currency stabilization.
- Foreign central banks are less focused on stabilizing against the dollar, signaling a weakening footprint.
