- The US dollar’s share of global FX and Gold reserves has fallen to a historic low of about 46%, declining 15 points since 2017.
- Central banks are aggressively accumulating gold and diversifying into other currencies, contributing to the dollar’s decline.
- The dollar’s “prestige” is visibly impacted, with geopolitical tensions and crises of confidence mirroring the last period it fell below 50% in 1990-1991.
- Analysts forecast a confident rally for gold could begin very soon, with a long-term price target of $8,000 apparently still in play.
The U.S. dollar’s dominance in the global financial system is eroding at an alarming rate, with its market share tumbling to a 26-year low of 46% as of April 2026. This represents a significant departure from historical norms and signals a major shift in international reserve asset allocation. Consequently, scrutiny of the dollar’s prestige and utility has intensified worldwide.
The latest IMF data shows the dollar now makes up 57% of global reserve currencies excluding gold, the lowest level since 1994. This decline is attributed to the aggressive accumulation of gold and diversification into other currencies by global central banks. Meanwhile, analysts forecast that as geopolitical tensions rise, a confident rally for precious metals could begin imminently, irrespective of specific diplomatic outcomes.
According to financial analyst Rashad Hajiyev, “At some point, which could be as early as next week, precious metals could start a confident rally despite no deal between the US and Iran.” He argues metals will ignore narratives linking military escalation to negative gold performance. Gold’s price target of $8K is reportedly still in play as the asset gains ground rapidly.
This trend parallels the 1990-1991 period, when the dollar last fell below 50% of global reserves amid elevated inflation, recession, and a crisis of confidence in the U.S. economy. Hajiyev further noted, “Whether the US achieves progress in negotiations with Iran or not does not change my view towards gold. Pandora’s box has been opened…” The suggestion is that escalating global debt and conflict will continue to fuel the dollar’s slide and gold’s ascent.
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