Fact-Check: Russia Moving Back To USD?
Today, financial news sources are flooded with information claiming that Russia is planning a return to the US dollar, as a part of wider strategic-economic partnership with Trump, but it is true?
Reportedly, Russiaâs move back to USD comes packaged with other economic cooperation points, mostly around commodities (fossil fuels in particular). This is what mainstream financial media like Bloomberg, Reuters and accounts with millions followers on X have been spreading viciously today, many of which frame this as the end of BRICS and/or the successful policies of the Trump administration.
What bothered me, is that none of them seem to clearly outline the source, mostly citing it as âBloomberg reportsâ. This brings the obvious question: what sources did Bloomberg use in making this report? Well, reports regarding âRussia returning to USD settlement systemâ arise from an "internal Kremlin memo" that Bloomberg supposedly had access to. No further information is provided regarding the nature of this memo. No Russian state sources confirmed this information. Itâs also not clear why Russia would seemingly sidestep their main strategic partner - China with this move (especially for those claiming the end of BRICS). So we are in a situation where Bloomberg claims theyâve seen X, and X gets spread as a fact, based on the claim by Bloomberg.
Major news sources are reposting this memo and framing it as Russiasâs return to USD without stepping back to analyze it critically. Why would Russia, which gradually moved away from USD throughout the last 20 years, would suddenly reverse their policy to accept USD as the preferred medium of settlement? Would Russia trade in USD again â of course, I donât believe they ever refused that.
Eventually, I fully expect Russia to be reintegrated back into international trade, and that includes trading in USD. Iâve written about that many times. What I do not expect is the Central Bank of Russia to dramatically increase USD instruments in their FX reserves. They were already sanctioned once, and that will remain a perpetual risk. Russia has successfully moved away from the U.S. Dollar, by replacing it with gold and renminbi, and they donât have a serious dependency on US trade. If you think that you will have American companies owning Russian fossil fuel production in the near future you are mistaken.
So my take on this: claims of Russiaâs return to USD settlement are overblown. This looks more like a coordinated campaign than something with real substance.
