The year 2026 may not bring a sudden fall of the US dollar. But it could mark the moment when its quiet decline gathers speed. As the US increasingly uses the dollar as a tool of pressure, other countries are working harder to trade and pay without it.
America’s role in global trade has been shrinking for years. In 2000, it accounted for about one-third of world trade. Today, that share is closer to one-quarter. At the same time, emerging economies are trading more among themselves. As these links grow, the dollar becomes less central.
This change is already visible. India and Russia now settle much of their trade in rupees, dirhams, and yuan. China routes more than half of its trade through its own payment system, CIPS, instead of SWIFT. Other country pairs—such as Brazil and Argentina, India and the UAE, Indonesia and Malaysia—are also testing trade in local currencies.
Central banks are responding too. In 1999, the dollar made up about 72 percent of global foreign exchange reserves. Today, it is down to around 58 percent, and the trend is downward. A reserve currency works on trust. And trust depends as much on perception as on facts. That perception is changing.
Domestic problems in the US are adding to the strain. Government deficits are large and still growing, expected to reach nearly $2 trillion in 2025. The current account gap is widening as well. To cover these gaps, the US relies heavily on creating new money. For years, the dollar’s special status absorbed the shock. Now, that cushion looks thinner.
Even US government bonds no longer feel as solid as they once did. There are now more than $27 trillion worth of US Treasuries circulating worldwide. This means more bonds to trade, settle, and hold. But the banks that are meant to provide liquidity have not expanded fast enough. When markets come under stress, there are simply not enough balance sheets to absorb heavy selling—unless the Federal Reserve steps in.
This weakness was exposed in March 2020, when the Treasury market froze during a crisis and needed direct central bank support. It was a rare moment when the world’s safest market failed to function on its own.
Looking ahead to 2026, the biggest risk to the dollar is unlikely to be another currency replacing it. Instead, the threat comes from new payment systems that bypass the dollar altogether. This is especially true in emerging markets, where access to dollar liquidity has often been costly, slow, or political.
Several alternatives are already taking shape. One is mBridge, a project involving central banks from China, Hong Kong, Thailand, and the UAE, supported by the Bank for International Settlements. It aims to allow countries to pay each other instantly using digital versions of their own currencies. Another is BRICS Pay, which would let BRICS and partner countries settle trade and investment directly in their local currencies.
Then there are stablecoins. These digital tokens allow money to move across borders quickly and cheaply, without traditional banks. Most stablecoins today are linked to the US dollar, which actually strengthens its reach. But that may change. If stablecoins tied to multiple currencies—or not tied to the dollar at all—become common, they could offer a neutral way to settle global trade.
China is unlikely to challenge the dollar openly. Instead, it is likely to build around it. Yuan-linked stablecoins may spread through Hong Kong, the Gulf, and Southeast Asia. Some could be backed by commodities like gold or oil. These tools could be used to pay for ports, energy shipments, or infrastructure projects without using dollars or US banks.
Traditionally, it has taken hundred years for one global currency to replace another. But technology is speeding things up. Digital finance, new trade routes, and shifting power balances are shortening the timeline. The dollar is still dominant. But the cracks are clearer than before. And in 2026, the risk of slipping is higher than it has been in a long time.
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[wptelegram-join-channel link=”https://t.me/s/upsctree” text=”Join @upsctree on Telegram”]2021 WEF Global Gender Gap report, which confirmed its 2016 finding of a decline in worldwide progress towards gender parity.
Over 2.8 billion women are legally restricted from having the same choice of jobs as men. As many as 104 countries still have laws preventing women from working in specific jobs, 59 countries have no laws on sexual harassment in the workplace, and it is astonishing that a handful of countries still allow husbands to legally stop their wives from working.
Globally, women’s participation in the labour force is estimated at 63% (as against 94% of men who participate), but India’s is at a dismal 25% or so currently. Most women are in informal and vulnerable employment—domestic help, agriculture, etc—and are always paid less than men.
Recent reports from Assam suggest that women workers in plantations are paid much less than men and never promoted to supervisory roles. The gender wage gap is about 24% globally, and women have lost far more jobs than men during lockdowns.
The problem of gender disparity is compounded by hurdles put up by governments, society and businesses: unequal access to social security schemes, banking services, education, digital services and so on, even as a glass ceiling has kept leadership roles out of women’s reach.
Yes, many governments and businesses had been working on parity before the pandemic struck. But the global gender gap, defined by differences reflected in the social, political, intellectual, cultural and economic attainments or attitudes of men and women, will not narrow in the near future without all major stakeholders working together on a clear agenda—that of economic growth by inclusion.
The WEF report estimates 135 years to close the gap at our current rate of progress based on four pillars: educational attainment, health, economic participation and political empowerment.
India has slipped from rank 112 to 140 in a single year, confirming how hard women were hit by the pandemic. Pakistan and Afghanistan are the only two Asian countries that fared worse.
Here are a few things we must do:
One, frame policies for equal-opportunity employment. Use technology and artificial intelligence to eliminate biases of gender, caste, etc, and select candidates at all levels on merit. Numerous surveys indicate that women in general have a better chance of landing jobs if their gender is not known to recruiters.
Two, foster a culture of gender sensitivity. Take a review of current policies and move from gender-neutral to gender-sensitive. Encourage and insist on diversity and inclusion at all levels, and promote more women internally to leadership roles. Demolish silos to let women grab potential opportunities in hitherto male-dominant roles. Work-from-home has taught us how efficiently women can manage flex-timings and productivity.
Three, deploy corporate social responsibility (CSR) funds for the education and skilling of women and girls at the bottom of the pyramid. CSR allocations to toilet building, the PM-Cares fund and firms’ own trusts could be re-channelled for this.
Four, get more women into research and development (R&D) roles. A study of over 4,000 companies found that more women in R&D jobs resulted in radical innovation. It appears women score far higher than men in championing change. If you seek growth from affordable products and services for low-income groups, women often have the best ideas.
Five, break barriers to allow progress. Cultural and structural issues must be fixed. Unconscious biases and discrimination are rampant even in highly-esteemed organizations. Establish fair and transparent human resource policies.
Six, get involved in local communities to engage them. As Michael Porter said, it is not possible for businesses to sustain long-term shareholder value without ensuring the welfare of the communities they exist in. It is in the best interest of enterprises to engage with local communities to understand and work towards lowering cultural and other barriers in society. It will also help connect with potential customers, employees and special interest groups driving the gender-equity agenda and achieve better diversity.