A handful of BRICS countries are cutting ties with the US Treasury by unloading Treasuries. The BRICS group is increasingly looking to diversify its investment portfolios with gold, local currencies and other commodities such as oil and gas. This step is considered a hedge against US economic policies that would narrow the dollar’s ability to finance the deficit. Latest data From the US Treasury it shows that the BRICS offloaded $18.9 billion in US Treasury bonds this month alone.
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BRICS countries dispose of $122.7 billion in US Treasury bonds
In 2023, the BRICS unloaded $122.7 billion in US Treasuries and moved away from government debt. China, a member of the BRICS group, is the highest, as it has discharged $117.4 billion worth of US government debt this year. Between June and July, China reduced its holdings from $835.4 billion to $821.8 billion, a decrease of $13.6 billion.
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Brazil, the other members of the BRICS group, followed suit and reduced its holdings of US Treasuries this year. The US Treasury in Brazil decreased from $227.4 billion in June to $224.7 billion in July, a decrease of $2.7 billion.
India, another BRICS member, followed a similar path and reduced its holdings by $2.3 billion during the same period. India is also alleged to have dumped US dollars in the forex markets to keep the value of the rupee from falling. Read here to know how India unloaded the US dollar to make the rupee end stronger this month.
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Likewise, the UAE saw its holdings of US Treasury bonds decline by $300 million in July. The UAE’s holdings fell from $65.2 billion in June to $64.9 billion the following month. In total, BRICS has removed $122.7 billion worth of US Treasuries from its reserves in 2023.
The coalition finds various means to end the supremacy of the US dollar and put local currencies before the US currency. Read here to find out how many sectors in the US would be affected if the BRICS stopped using the dollar.