Brazil’s central bank does not see any realistic prospect of emerging nations in the BRICS group creating markets large enough to topple the U.S. dollar’s dominance within the next 10 years, monetary policy director Nilton David said on Monday.
There is not a meaningful stock of BRICS-denominated assets that could offset the dollar at the moment, David told a central bank webcast. “I don’t think that will change over the coming decade,” he added.
The director acknowledged that alternative settlement tools could gain traction and help boost bilateral trade deals, but nowhere near enough to dislodge the dollar in any visible horizon.
The BRICS acronym refers to the five major emerging economies of Brazil, Russia, India, China and South Africa, which have been working together to address global issues. The group recently added six other members.
Reuters reported in February that Brazil’s presidency of BRICS this year would shelve talk of a common currency, focusing instead on ways to trim dollar reliance, such as linking payment systems and exploring blockchain standards set by bodies like the Bank for International Settlements.
U.S. President Donald Trump has repeatedly cautioned the BRICS group – whose original members were Brazil, Russia, India and China – against attempts to challenge the supremacy of the dollar.
Founded in 2009 and soon expanded to add South Africa, the group has recently included Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates, making it a growing diplomatic counterweight to traditional Western powers.
David also said he views bitcoin as “a speculative currency by nature,” noting that Brazil’s $340 billion foreign-exchange reserves remain overwhelmingly in dollars because nearly all of the country’s external transactions are settled in the U.S. currency.
According to the director, the central bank wants to preserve the liquidity and depth of its foreign-exchange market but it acknowledges that these features have side effects.
David noted that the Brazilian real has a “natural” correlation with risk assets, making it more volatile.
It is often the pivot for portfolio managers, he said, adding that this attracts investors who hold the currency only briefly, causing demand to swing sharply.
Published on May 20, 2025
