Dollar Reserves Remain Steady Despite Concerns About De-Dollarization

The world's dollar reserves have not decreased significantly in the past decade, despite concerns about de-dollarization. According to data from the International Monetary Fund (IMF), the dollar share of foreign exchange reserves has remained steady at around 56.5%.

The action is elsewhere: China's state banks and Japan's Government Pension Investment Fund (GPIF) have accumulated large amounts of foreign assets, often in dollars. These quasi-sovereign investors now hold more dollars than some central banks.

In China, the state commercial banks have amassed $2.5 trillion in foreign currency assets, mostly held abroad. The dollar share of these assets is around 70%, exceeding the dollar share of China's formal reserves (55% in 2019). Japan's Ministry of Finance and GPIF also hold a significant portion of their foreign assets in dollars.

The Public Investment Fund in Saudi Arabia has $250 billion in foreign investments, with roughly $200 billion held in dollars. Similarly, the Korea National Pension Service holds over 70% of its foreign assets in dollars.