The US dollar’s status as the world’s reserve currency is threatened by the impending debt crisis in the United States
Paul Ryan, a former speaker of the House, has warned that the United States’ mounting national debt threatens the dollar’s status as the world’s reserve currency.
In a recent interview with CNBC, Ryan criticised US Vice President Joe Biden for not doing more to stem the country’s mounting debt.
The former congressman from Wisconsin claims that the United States is speeding towards a debt catastrophe that might undermine the dollar’s position as the world’s primary reserve currency.
“Now we have politicians who claim they will do nothing to avert a national debt disaster. And an impending debt catastrophe is widely anticipated. Therefore, he is asking for trouble in that respect. His actions threaten our continued status as a reserve currency. He is bringing us closer to a debt catastrophe by promising not to address this.”
From $31.46 trillion on June 1st to the current value of $32.32 trillion, the United States government only raised about $1 trillion in debt last month. This year, interest payments alone are expected to cost the government $663 billion.
The national debt is expected to reach about $52 trillion within a decade. The US Congressional Budget Office predicts rising US debt will hurt the economy over the long term.
“Such a large and growing debt would reduce economic growth, increase interest payments to foreign holders of US debt, and significantly threaten the fiscal and economic outlook; it may also make politicians feel constricted in their policy options.”