IMF prepares for run on U.S. dollar

The International Monetary Fund is preparing for the possibility of a rapid sell-off of U.S. dollar-denominated assets, its managing director, Kristalina Georgieva, said today.

"At the fund, one muscle that we are building is our ability to hypothetically present scenarios of unthinkable events and then figure out what to do," Georgieva said at an event hosted by Bruegel, a Brussels-based think-tank.

Asked whether the scenarios include a potential run on dollar assets, Georgieva said the fund runs "all kinds of scenarios" and that it was examining the issue as part of its ongoing analysis.

Her comments come as Donald Trump's sweeping tariffs and attacks on the Federal Reserve's independence and the rule of law have sparked deep investor unease about the status of the dollar, which has dominated global finance since the end of the Second World War.

The greenback's value has fallen more than 9% against a basket of other currencies since Trump's return to the White House in January 2025. The dollar's decline against the euro has been even steeper, at just under 12%.

Fears about the greenback's continued status as a "safe haven" have also caused investors to pile into gold, with the price of bullion reaching a record high of $5,100 per troy ounce today....

The first country to anchor their currency to Gold will become the major player.

We shall see, shortly.

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Sadly, I doubt anybody will tie their currency to gold unless there is hyperinflation, and maybe that won’t happen soon.

Sadly, I doubt anybody will tie their currency to gold...

The Chinese and Brics already have been testing the new system. Member states can settle in local currency or Gold transfers.

“BRICS and Gold Settlement
Overview of BRICS Gold Settlement
The BRICS nations, which include Brazil, Russia, India, China, and South Africa, are increasingly moving away from the US dollar for international trade. They are implementing a new gold-backed currency system to facilitate settlements among member countries. This shift aims to reduce reliance on the dollar and enhance economic independence.
Key Features of the Gold Settlement System
FEATURE DESCRIPTION
Currency Composition The new settlement unit is pegged 40% to gold and 60% to a basket of BRICS currencies.
Purpose Acts as a neutral settlement tool for trade, reducing dependence on US banks and dollar assets.
Pilot Launch A pilot program for this gold-anchored currency was launched on October 31, 2025.
Geopolitical Context The initiative responds to sanctions and economic pressures faced by member countries.
Gold Production and Reserves
BRICS countries control about 50% of global gold production and have significantly increased their gold reserves. This includes:
Russia: Approximately 2,336 tonnes of gold.
China: Approximately 2,298 tonnes of gold.
Brazil: Recently re-entered the gold market, adding 16 tonnes in September 2025.
Implications of the Gold Settlement
The move towards a gold-backed settlement system is part of a broader strategy to create a parallel financial architecture that minimizes exposure to dollar volatility and geopolitical risks. This shift is expected to strengthen long-term demand for gold and reshape global trade dynamics.”

President Trump had better get busy with his promised Gold Reserve audit.

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