The BRICS Nation (including Brazil, Russia, India, China, South Africa) are creating a new currency to be unveiled at the 15th BRICS summit later this year.

Why the joint countries called BRICS Nation (including Brazil, Russia, India, China, South Africa) are creating a new currency and its effect on the collapse of dollar.

It’s been several months since the Russia-Ukraine war began and an avalanche of sanctions and restrictions hit the Russian Government led by Vladimir Putin. This has made the Russian Government to take its relationship with some allies to a new level. Now Russia and its allies (BRIC Nations) appear poised to go a step further with the formation of the new currency.

The term BRIC was coined by economist Jim O'Neill in 2001 as an acronym for the four countries —Brazil, Russia, India, China— he identified as being at a similar stage of newly advanced economic development. In 2009, the leaders of the four countries held their first summit and in 2010 BRIC became a formal institution. The ties between the nations has been impressive and their development rapid just like the Goldman Sachs predicted that the global economy will be dominated by the four BRIC economies by 2050.

According to reports quoting Russian lawmaker Alexander Babakov, the BRICS nations are in the process of creating a new medium for payments - established on a strategy that "does not defend the dollar or euro". 

Babakov, who is the deputy Chairman of Russia’s State Duma, reportedly indicated that the new currency would be secured by gold and other commodities such as rare-earth elements. The BRICS countries are working on creating a new form of currency with a plan to present its development at the BRICS leaders’ summit this year, he said on the sidelines of the India-Russia Business Forum in New Delhi last week. The 15th BRICS summit is all set to take place in South Africa's Durban in late August this year.

This movement and development is having its effect on the dominance of US dollar and making its collapse rapid. The dollar collapse is in it’s lowest than it has been in years.

Quoting the American Television Host, Tucker Carlson, he said; “The dollar is collapsing rapidly, and a conflict with Russia is the last one the US can afford. We should prepare to lose our position as the owner of the world's reserve currency. It is happening slowly but surely. This policy has forced Russia, China, India, Turkey and other countries to accelerate their flight from the US dollar.”

The Brazilian President, Luiz Inácio Lula da Silva also calls for countries to increasingly use their own currencies and end the trade dominance of the US Dollar.

What is going to be the American President Joe Biden’s response to this development?.

Reference: Indiatimes, Wikipedia.