Martin Wolf talks to Kenneth Rogoff: Trump is accelerating the dollar’s decline

In this episode of The Economics Show, Martin Wolf interviews Ken Rogoff about the future of the US dollar as a global currency. They discuss the dollar's gentle decline since 2015, accelerated by factors such as Trump's policies and the US's financial actions against Russia. Rogoff highlights various measures indicating the dollar's weakening dominance, including trade denomination and foreign central banks' exchange rate management. They explore the potential consequences of Trump's protectionist policies on the dollar's appeal and the global financial sector, as well as the possibility of a Mar-a-Lago Accord. The conversation touches on the parallels with the Nixon shock of the 1970s and the potential for a tripolar currency system involving the renminbi and the euro. Rogoff predicts fiscal problems, inflation, and financial repression, leading to a chaotic situation and increased volatility, while also noting the growing importance of crypto. They conclude by discussing potential steps to restore the dollar's position, emphasizing the need to address the fiscal position and acknowledge trade-offs in economic policies.