Is there no escaping the dollar?

The most effective weapon in America’s tussle with strategic and economic competitors may be 100 US cents.
Countries like Russia and China chafe at the dollar’s dominance, but there’s little they can do other than posture and make relatively benign adjustments to their monetary arrangements. Russian President Vladimir Putin acknowledged as much, telling journalists that “we don’t want to do away with it, because it’s a universal currency.” China’s campaign to internationalise the yuan,
which received backing from the International Monetary Fund in 2016, is going nowhere fast.
Putin spoke after Russia’s oil fund said it will eliminate holdings of dollars and shift them into euros, gold and the yuan. The transfers will take place within the central bank’s reserves and there was little impact on markets. The backdrop to all this is Russia’s objection to sanctions that Washington has applied since Putin annexed the Crimean peninsula from Ukraine in 2014. The country has since tried to reduce its exposure to the American asset. In 2019, state oil giant Rosneft moved its export contracts into euros. Russia’s share of exports sold in the US currency fell below 50% for the first time in the fourth quarter of 2020.
Despite its harumphing, Russia has acknowledged the buck is so ubiquitous in global commerce that it’s hard to function as a modern society without it. The dollar accounts for almost 60% of global central bank reserves and 88% of foreign-exchange transactions are against the US currency. About half of cross-border loans and international debt securities are denominated in greenbacks. When markets seized up early in the Covid-19 pandemic, it was the Federal Reserve — not the Bank of Russia or the People’s Bank of China — that threw its arms around the world financial system.
But is the dollar’s primacy impregnable? There are reasons to be skeptical.

—Bloomberg