US Treasury Secretary: No Alternative Reserve Currency Can ‘Replicate’ Role Played by the Dollar

United States Treasury Secretary Janet Yellen recently told members of the U.S. Congress that while some countries are seeking to create alternatives to the greenback, no country, including China, can create a currency which replicates the dollar’s role in the global financial system. The U.S. Treasury secretary also claimed that it will not be easy for any country “to devise a way to get around the dollar.”

Using an Alternative Reserve Currency to Skirt U.S. Sanctions

United States Treasury Secretary Janet Yellen has told members of the Financial Services Committee of the U.S. Congress that the ongoing trend of countries seeking to establish an alternative reserve currency to rival the greenback “is something that we simply have to expect.” In her June 13 appearance before the committee, Yellen claimed that countries championing the creation of an alternative to the dollar are doing so because they want to avoid the effects of U.S. sanctions.

Yellen’s apparent admission that some countries are not happy with the United States’ alleged weaponization of the dollar came amidst increased calls for de-dollarization of the global economy. As has been reported by Bitcoin.com News, some Asian and South American countries have agreed to use local currencies when settling cross-border transactions. In addition, many countries including those sanctioned by the United States government, have signaled their support for the Brazil, Russia, India, China and South Africa (BRICS) currency.

Absence of Capital Controls

While she acknowledged that the United States’ rivals are seeking to de-dollarize, the Treasury Secretary insisted that the greenback’s role in the global financial system is unparalleled and therefore toppling it is not going to be easy.

“The dollar plays the role it does in the world financial system for very good reasons that no other country is able to replicate, including China. And that is we have deep, liquid and open financial markets, a strong rule of law and an absence of capital controls that no country is able to replicate,” Yellen said when responding to a question from Ohio U.S. House representative Warren Davidson.

The Treasury Secretary also claimed that it will not be easy for any country “to devise a way to get around the dollar.” However, in her earlier remarks, Yellen reiterated her belief that Congress’ inability to raise the debt ceiling limit in time is harming the United States’ reputation as a country that pays its bills on time.

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