The world breathes the sigh of relief as Trump saves fed, FMI

By Francesco Canepa, Jan Strucczewski and Leika Kihara

The policymakers of Washington (Reuters) -Global who gathered in Washington breathed a collective sigh that the economic order focused on the United States that prevailed over the last 80 years has not yet collapsed despite the inner approach of Donald Trump.

The Spring Meetings of the International Monetary Fund and the World Bank were dominated by commercial conversations, which also provided some statements by Washington climbers on their relations with China.

But some deeper questions raised on central bankers and finance ministers after Trump’s attacks on international institutions and federal reserve: we can still count on the north -American dollar as the world’s secure shelter and the two lenders who have supported the international economic system since the end of World War II?

Conversations with dozens of policymakers around the world revealed widespread relief in reducing their threats to set fire to Fed Fed President Jerome Powell, the international dollar state tutor to whom he had previously described as “important loser.”

And many also saw a silver lining in the call of the United States Treasury Secretary, Scott Bessent, to remodel the IMF and the World Bank according to Trump’s priorities because it was not about to remove the two lenders that helped create at the 1944 Breton Woods conference.

“This week was a prudent relief,” said Robert Holzmann, governor of the Central Bank of Austria. “There was a turn (in the position of the United States Administration), but I ask myself not the last. I keep my reserves.”

A politicization of the Fed and, to a lesser extent, the exit of the IMF and the World Bank are almost too much to understand most officials.

Deprived of a last -resort lender, about $ 25 trillion and loans issued abroad will be called into question.

No alternative

At the heart of policymakers’ concern is that there is no alternative in the United States as the world financial hegemon, a situation that economists know as the Kindleberger trap after renowned historian Charles Kindleberger.

Of course, the euro, a distant reserve currency, is gaining popularity in the eyes of the recently found state of the European Union as an island of relative stability.

But politicians who spoke with Reuters were forceful that the single European currency was not yet ready to overthrow the dollar, and at best could expect to add a little to its 20% share of world reserves.