Dollar dominance is going to stick around in global markets as there's nothing on the horizon to rival the greenback, Fed study says

According to a new study by the Federal Reserve Bank of New York, the US dollar's dominance won't be affected by the rise of digital assets.

The dollar's international role, whether for trade, investment or use as a global reserve currency, remains quite strong.

According to the authors, the role of the US dollar as an international currency has been strengthened in recent years by a reduction in the emphasis on protectionism.

The dollar's role as a reserve currency means other nations hold it as a reserve currency even if its dominant position has slipped over the last two decades.

The war sanctions against Moscow could encourage other countries to stop using the dollar because of the US's financial clout.

The rise of central bank digital currencies and cryptocurrencies could eventually reduce the sway of the dollar as a cross-border asset and investment.

According to analysts, the Chinese yuan is unlikely to pose a real threat to the US dollar for a long time.

The International Monetary Fund's international reserve assets are made up of a basket of currencies and the Chinese currency is nowhere near that of the US dollar.

The authors said that the dollar plays a large role in foreign exchange transactions. The euro is very close to the dollar and there is no evidence that this should change.

The US dollar is a store of value, unit of account and medium of exchange. US assets are seen to be safe and liquid.