Republican presidential candidate Donald Trump unveiled a bold new plan to preserve the US dollar’s global dominance during a rally in Wisconsin on Saturday. Trump pledged to impose a 100% tariff on goods from countries that move away from using the dollar in international trade.
“You leave the dollar and you’re not doing business with the United States because we are going to put a 100 percent tariff on your goods,” Trump declared, emphasizing his protectionist approach.
This announcement follows in-depth consultations between Trump and his economic advisers on how to penalize nations that trade using currencies other than the dollar. Potential actions under consideration include export controls, currency manipulation charges, and tariffs, as reported by Bloomberg News.
Trump, who has consistently supported protectionist policies, claimed that the dollar has been “under major siege” over the past eight years. This comes after a recent summit where China, India, Brazil, Russia, and South Africa discussed strategies to de-dollarize. Trump, however, reaffirmed his commitment to maintaining the dollar as the world’s reserve currency.
Despite a gradual decline in the dollar’s dominance, it still comprised 59% of official foreign-exchange reserves in early 2024, according to the International Monetary Fund, with the euro trailing at nearly 20%.
In the fiercely contested presidential race, Wisconsin is a crucial battleground state where Trump and Democratic opponent Kamala Harris are competing for the support of working-class voters disillusioned with President Joe Biden’s economic policies. A recent Bloomberg News/Morning Consult poll shows Harris leading Trump by 8 percentage points in Wisconsin, the largest margin among the seven battleground states surveyed.
Trump’s rally in Wisconsin was part of a broader campaign tour that included stops in Pennsylvania and North Carolina, as well as a major address in New York City focusing on economic issues. Meanwhile, Harris spent Saturday in Pennsylvania preparing for her upcoming debate with Trump, a key event that could impact the tight race.
As Trump’s campaign continues to highlight economic nationalism and defend the dollar, the global repercussions for countries like India, which have been involved in de-dollarization discussions, remain significant. The evolving dynamics between the US and its international trade partners are expected to be a major focus in the run-up to the election.
