A1 Trading Company

July 28, 2022

New BRICS Currency vs USD

Michael J. Donoghue
New BRICS Currency Vs USD

What Is BRICS?

The acronym BRICS refers to an economic alliance between multiple powerful emerging economies, including Brazil, Russia, India, China, and South Africa, respectively. Altogether, they currently generate over 25% of the world’s GDP, and are home to over 40% of the global population. While BRICS membership does not necessarily entail exclusive trade perks or benefits, they value geopolitical cooperation with one another, meeting at annual summits since 2009.

How Are They Challenging USD?

Many analysts interpret BRICS as being a response to the West’s expanding geopolitical influence via NATO and the G7, one that grows ever more significant following the invasion of Ukraine. This function is particularly evident given that Russian President Vladimir Putin recently proposed in June that BRICS develop an "international reserve currency based on the basket of currencies of our countries" to rival the US Dollar. If enacted, this could mean the end of an era for USD hegemony on the world stage.

How Serious Are Their Intentions?

China is reportedly aiding in this new reserve currency endeavor, as Western sanctions against Russia pile up while other BRICS countries fear similar treatment. China’s President Xi Jinping has accused the US and its allies of constructing “a small yard with high fences” via economic warfare. This international sentiment is apparently not unique: thus far, five more countries have either applied or plan on applying to join BRICS, including Iran, Argentina, Saudi Arabia, Turkey, and Egypt, with many more countries formally invited. This interest is especially significant in light of the existing tensions between these countries, such as China and India, Iran and Saudi Arabia, etc.

How Could This Affect Major Pairs?

If such an alternative reserve currency is enacted, and subsequently denominates many international trade transactions as the BRICS alliance grows, the foreign exchange market could see a big drop in demand for USD against other currencies. This could also herald the end of the petrodollar since many BRICS countries are prominent oil and gas exporters. Although these ambitious plans will likely not be realized for some time, this could eventually mean a huge paradigm shift for major pair fundamentals.

A1 Edgefinder

AI- Generated Trading Setups
AI-generated bullish/bearish bias setups on forex currencies, gold, & indices.

Discount code: 'READER'

Access Now

Free

Trading Plan Template
Struggling to build a successful trading plan? Download our template to get started today!
Download
Shutdown Halted, Dollar Climbs

Just before the scheduled shutdown at 12:01 am on Sunday, Congress voted to extend the deadline for another 45 days. Yields jumped higher to above 5.1% which has remained elevated for some time. As we enter an historically bullish month for the indices, here are some setups on dollar, gold and index setups EdgeFinder Analysis […]

Read More
Yields Hold Steady After GDP

GDP numbers came in lower than expected in the US, marking the third straight drop in economic output. This is usually good news for the stock market indices and gold, however, bond yields continue to hold up above 5.1%. Here are some potential trade setups for both dollar and index longs depending on how the […]

Read More
USOil Breaks Through the Highs! (+$2646.85)

Hi, I’m Nick! I am the founder of A1 Trading, market analyst, YouTuber, and creator of the EdgeFinder software tool. I caught a huge winner on USoil with the help of the EdgeFinder! In this article, I’ll walk you through my thought process behind the trade and how I found this crazy runner! Finding My […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
Home
Edgefinder
VIP
Menu
homesmartphonelaptop-phonemenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram