Former International Monetary Fund (IMF) Deputy Director Zhu Min warned on Wednesday that diminishing global confidence in the U.S. Dollar poses a significant risk to the world economy this year. Zhu, who also served as a Deputy Governor of the People’s Bank of China, detailed his concerns in an article published by China’s International Finance magazine.
According to Zhu, the dollar’s share of global foreign exchange reserves has fallen from 70 percent to 57 percent, a decline he attributes to eroding trust in the U.S. Financial system. This shift, he noted, coincides with a rise in the proportions held in gold, the euro, and the Chinese yuan, signaling a market perception that the dollar’s dominance is waning.
The assessment comes as Chinese President Xi Jinping has repeatedly emphasized the need for China to develop a “strong currency” capable of competing with the dollar in international trade and finance. In remarks publicized earlier this month, Xi called for the renminbi to turn into a widely used global reserve currency, backed by a “powerful central bank,” according to a report in CNN on February 3, 2026.
Zhu Min also highlighted the importance of actions by the U.S. Federal Reserve. He stated that interest rate cuts will be crucial for stabilizing financial markets, but cautioned that a misaligned pace of cuts relative to inflation could introduce modern uncertainties.
The trend toward de-dollarization is prompting investors to diversify into alternative assets, including gold and emerging markets, particularly China, amid concerns about the long-term financial sustainability of the United States. Analysts note that the renminbi currently holds the position of the world’s second-largest currency used in trade finance, though its overall role in global reserves remains limited, according to a recent Facebook post by Kristie Lu Stout on February 2, 2026.
China has been actively working to internationalize the renminbi for over a decade, seeking to ensure its stability and integration into international markets. The country has established currency swap lines with 40 other nations, allowing foreign central banks to borrow renminbi using their own currencies as collateral, as reported by the Federal Reserve on August 30, 2024.
The IMF’s Special Drawing Rights (SDR) currently comprise a basket of currencies including the U.S. Dollar (0.58252), the euro (0.38671), the Chinese yuan (1.0174), the Japanese yen (11.900), and the British pound (0.085946), according to Wikipedia data. China has increasingly sought to expand its influence within the IMF, evolving from a “rule-taker” to a “rule-shaker” and simultaneously pursuing alternative financial institutions.
