Central banks across the world are planning to cut dollar allocations rather than increase them in the coming decade as political risks associated with the US currency rise, showed an OMFIF (Official Monetary and Financial Institutions Forum) survey of public investors.
It is the first time the survey, carried out by the Forum, has found such a shift away from the dollar.
The findings also arrive amid the ongoing global debate about the currency’s role as the primary reserve one, as policy uncertainty from the Donald Trump administration, along with heightened geopolitical risks, makes holding dollars less viable for the financial institutions around the world.
The London-based think tank also found an eagerness among the 90 surveyed central banks, public pension funds, and sovereign wealth funds to significantly increase use of AI from current levels.
“Survey participants, who collectively oversee some USD 10 trillion in assets, increasingly viewed volatility as a permanent feature and are testing new approaches to dealing with it, including applying AI to the problem. The old assumption that public investors can wait for the environment to normalize looks increasingly unrealistic,” OMFIF senior economist Yara Aziz wrote in the report.
“There is no clear alternative to the dollar, and the currency has rallied 3% in 2026, driven by higher US interest rates, a thirst for American assets, and a flight to safety sparked by the Iran war. However, some 79% of central banks, and 60% of public funds, believe the global monetary system is transitioning towards a multipolar world,” Yara Aziz noted.
“Currencies other than the top eight are gradually gaining ground among reserve assets. Central banks have sought to increase Norwegian crown and New Zealand dollar allocations and have also increased their interest in sterling,” she stated further.
While survey respondents also maintained their intentions to increase euro and Chinese renminbi holdings, structural challenges have reduced the appeal of both currencies. Still, nearly all of the participants viewed the yuan as an effective portfolio diversification tool.
“On the other hand, gold, which has hit a series of record-high prices and is held by 82% of central banks, has moved to the center of reserve management strategy,” OMFIF said.
In the short term, the yellow metal has emerged as the asset in which central banks are planning most to increase holdings, with a net 30% of respondents intending to boost their allocation over the next one to two years.