Seeds of Wisdom RV and Economic Updates Sunday Afternoon 7-20-25

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Biggest Economic Showdown: U.S. Tariffs vs. BRICS De-Dollarization Surge

Trump’s New Tariff Threats, BRICS Payment Systems, and the Decline of Dollar Dominance Shape the 2025 Financial Battlefield

The defining economic confrontation of 2025 has emerged: U.S. tariffs vs. BRICS de-dollarization. President Donald Trump has escalated the conflict by threatening an additional 10% tariff on any country that aligns with what he labels “Anti-American policies of BRICS.”

As BRICS nations aggressively move to reduce reliance on the U.S. dollar, the stakes for global financial dominance have never been higher. New trade and currency systems being advanced by BRICS directly challenge the U.S.-led order, placing enormous pressure on dollar hegemony.

Dollar Dominance Faces Historic Decline

Data confirms a major shift away from the U.S. dollar:

  • The dollar’s share in global foreign currency reserves has dropped to a record low of 57.8% (IMF, end of 2024)

  • Gold now makes up nearly 20% of central bank reserves

  • Over 244 metric tons of gold were purchased by central banks in Q1 2025 alone

According to the World Gold Council’s 2025 survey95% of central banks expect to continue increasing gold reserves, signaling continued movement away from dollar-based assets amid the accelerating BRICS de-dollarization campaign.

Trump’s Aggressive Tariff Strategy

Rather than focusing solely on trade imbalances, the Trump administration has implemented targeted tariffs on BRICS-aligned nations:

  • 30% tariffs remain on most Chinese goods

  • South Africa also faces a 30% tariff

  • Malaysia, Indonesia, Myanmar, and Laos are under pressure to strike deals with Washington by August 1, or face similar penalties

This comprehensive strategy reflects a broader U.S. economic retaliation not just against China, but against any nation participating in alternative financial systems that undermine U.S. influence.

The BRICS Payment Revolution

BRICS has made major strides toward a post-dollar cross-border payment ecosystem:

  • 90% of Russia–China trade is now conducted in rubles and yuan

  • The BRICS Cross-Border Payments Initiative, designed to rival SWIFT, is being fast-tracked

  • The 17th BRICS Summit in Rio formally endorsed advancing this system as a strategic economic defense

This growing infrastructure represents a direct challenge to dollar-settled trade and threatens U.S. sanctions effectiveness.

China’s Commanding Role in BRICS

China is the economic powerhouse of BRICS, accounting for:

  • Nearly 50% of BRICS GDP

  • 70% of Brazil’s BRICS exports

This reveals an imbalance of influence, where China’s interests dominate the bloc’s strategic decisions—particularly in trade and technology.

China also controls a majority of the global supply of rare earth minerals, giving it powerful leverage in both economic and military-industrial domains. This adds a critical dimension to the China–U.S. trade war now unfolding across multiple fronts.

The Future of Global Finance: Unipolar vs. Multipolar Order

While BRICS nations have yet to unify their tariff response, their coordinated actions on currency and payment alternatives suggest a real push toward a multipolar financial system. However, analysts caution that true dollar displacement is unlikely unless an alternative currency emerges that is:

  • Liquid

  • Fully convertible

  • Backed by transparent and independent institutions

Still, the momentum behind BRICS de-dollarization signals the most serious challenge to U.S. financial dominance in decades.

@ Newshounds News™
Source: 
Watcher Guru

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