Over the past six months, the Group of Seven (G7) has leveraged the combined force of the dollar, euro, pound, and yen to exact a heavy toll on the Russian economy. The backbone of this strategy rests on the way the world uses the dollar as an international reserve currency and the overwhelmingly preferred settlement mechanism in global currency exchanges. Nearly half of the world’s trade is conducted in dollars, which also comprise approximately 60 percent of global foreign-exchange reserves. But everything has a price. By imposing sanctions and freezing assets in response to Russia’s invasion of Ukraine, the G7 has ... (full story)