Economist’s “News and Views” 6-16-2025

17/06/2025

Asia Moves Forward to Ditch Dollar: 50% Crash by 2030 Expected?

Daniela Cambone: 6-16-2025

“The U.S. dollar is likely to go down 25 to 50% over the next five years,” says Marko Papic, Chief Strategist at BCA Research.

He tells Daniela Cambone that the driving force behind this decline is less about the loss of reserve currency status and more about fading U.S. economic outperformance. Papic also points out that Trump’s tax cuts bill “does not add to growth in any way, shape, or form” and warns, “Expectations of U.S. growth are overstated, and that means the dollar is way too expensive.”

He further argues that rate cuts are becoming ineffective, as the long end of the yield curve remains unresponsive. “Everyone borrows at the long end of the curve — not the short end. So if the long end doesn’t fall, rate cuts don’t matter.”

What matters now, he stresses, is fiscal and trade policy — not monetary policy. Papic’s advice to investors: “Diversify out of the dollar — diversify out of the U.S.”

Chapters:

00:00 – Asia moves away from the U.S. dollar

03:31 – Is the dollar’s reserve status at risk?

05:57 – U.S. fiscal expansion explained

08:37 – Will we see interest rate cuts?

10:15 – The future of the U.S. dollar

12:15 – Where does gold fit in?

13:26 – A new world order: U.S. foreign policy shift