Illustration: Sarah Grillo/Axios

As the longest U.S. government shutdown on record drags into its 27th day, questions are again rising about the dollar's status as the world's reserve funding currency.

The big picture: Bank of England governor Mark Carney said recently that "ultimately we will have reserve currencies other than the U.S. dollar." This isn't a new idea. China’s central bank in 2009 called for a global move away from the dollar after the market turbulence caused by the U.S.-induced global financial crisis.

What they're saying: "There's a disconnect there, increasingly so, as the U.S. is less dominant in terms of the total economic pie in the world," John Hardy, head of FX strategy at Saxo Bank in Copenhagen, told me in June.

  • Carney further addressed the disconnect last week during a Q&A session, noting “the evolution of the global financial system is currently lagging behind that of the global economy."

Movement away from the dollar also has been taking place organically over the last few years. The most recent IMF data shows the dollar's share of currency reserves is at the lowest level in nearly 5 years, and has fallen for 8 of the last 10 quarters — though the dollar still accounts for more than 60% of global reserves.

  • Given the glacial pace of countries adopting new currencies, analysts agree it will likely be a while before the greenback loses its golden status.

Between the lines: However, the dollar's recent strength and President Trump's unpredictable and often market-moving antics have driven the issue back to the forefront. It's been 75 years since the Bretton Woods Agreement that made the dollar the world's funding currency, and drastic action could make moving away from the greenback a priority for some of the world's central bankers.

More Carney: "For example, emerging-market economies' share of global activity is now 60%, but their share of global financial assets lags behind at around one-third.”

  • Half of international trade was meanwhile invoiced in U.S. dollars, even though the U.S. share of international trade was only some 10%, Carney added.

Go deeper: The U.S. dollar's wild ride

Go deeper

The Biden blowout scenario

Joe Biden speaks at an outdoor Black Economic Summit in Charlotte yesterday. Photo: Kevin Lamarque/Reuters

Joe Biden or President Trump could win the election narrowly — but only one in a popular and electoral vote blowout. 

Why it matters: A Biden blowout would mean a Democratic Senate, a bigger Democratic House and a huge political and policy shift nationwide.

Justice's moves ring Big Tech with regulatory threats

Illustration: Annelise Capossela/Axios

The Department of Justice proposed legislation to curb liability protections for tech platforms and moved a step closer toward an antitrust lawsuit against Google Wednesday.

The big picture: As President Trump faces re-election, lawmakers and regulators are hurriedly wrapping up investigations and circling Big Tech with regulatory threats.

Democrats' mail voting pivot

Illustration: Sarah Grillo/Axios

Democrats spent the early months of the coronavirus pandemic urging their base to vote absentee. But as threats of U.S. Postal Service delays, Team Trump litigation and higher ballot rejection rates become clearer, many are pivoting to promote more in-person voting as well.

Why it matters: Democrats are exponentially more likely to vote by mail than Republicans this year — and if enough mail-in ballots are lost, rejected on a technicality or undercounted, it could change the outcome of the presidential election or other key races.

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