The monetary and economic dominance of the US is by no means set in stone, according to US economist Barry Eichengreen in an interview with Swiss National Radio on the sidelines of the Forum for Economic Dialogue.

This interview by Jan Baumann was originally published in SRF Echo der Zeit on 13.11.2025 in German. Translated and edited for context purposes by the UBS Center.

Eichengreen adds that there is a good chance that the highest court in the US will thwart the president's plans regarding tariffs. The renowned economist and economic historian teaches at the University of California, Berkeley.

“Trump would then have to start from scratch and use a different legal basis to reintroduce tariffs.” It is not known how high the tariffs would be in this case. Therefore: “My advice to Switzerland would be to wait and see what happens next,” says Eichengreen.

At the same time, Switzerland must approach other trading partners in order to be less dependent on the US market.

No unlimited US influence

Moreover, the dollar also illustrates the fact that the US and its president do not have unlimited influence on the global economic and financial system; its dominance in the global economy is on the decline, albeit only gradually, Eichengreen notes.

He believes that the decline of the dollar is, to a certain extent, “inevitable.” The economist draws a comparison: as the international reserve currency, the dollar is like a glacier. And as we know, a glacier can erode very slowly – “but then it suddenly collapses.”

It now depends on the extent to which Trump continues his unpredictable, sometimes autocratic policies. This applies to tariffs, his changing geopolitical alliances, but also the rule of law and the separation of powers in the United States.

Will confidence in the dollar remain intact?

All these questions cast a negative light on the dollar's global role as a safe haven. Around the world, people hold huge sums of dollars because they trust the currency. So far, there is no need to fear that the money will suddenly lose value or that it will no longer be freely available.

Eichengreen warns against premature schadenfreude outside the US about a possible rapid decline of the dollar as a global currency. This is because there is currently no viable alternative to the dollar – with its dominant position as a means of payment in world trade and as the reserve currency of the global financial system.

Neither the Chinese renminbi nor the euro could fully assume this important role in the foreseeable future. The head of the European Central Bank, Christine Lagarde, has already spoken of a “golden opportunity” for the euro due to Trump's tariffs.

However, the scenario of a rapid decline of the dollar is anything but promising, a situation that. Eichengreen personally fears.

Globalization would be threatened

“If the dollar were to lose its dominance, if there were a flight from the dollar, the alternative would be insufficient liquidity. In other words, there would not be enough secure and liquid assets to support the many transactions in the global trade and financial system. That would threaten globalization as we know it in the 21st century,” says the economist.

Barry Eichengreen takes a different view of the Swiss franc's position. This is because Switzerland remains a well-governed country, unlike the United States. The Swiss franc's status as a safe haven will therefore remain intact. Meanwhile, if things continue as they are, the dollar will slowly lose its status as the dominant global currency.