'Wave Goodbye To America..': Why US President Donald Trump Warned BRICS Countries Of 100% Tariffs?

Donald Trump 2.0: The effect of the return of Donald Trump as US President way before his swearing-in January 2025, has already started to spread like wildfire from tariffs to his border czar among others. This time, Trump 2.0 has a message to BRICS countries. He took to his X handler to warn BRICS countries to replace the US dollar as an international trade currency. He curtly said they can "Wave Goodbye To America."

On December 1, 2024, Trump through his X handler said, that the idea that the BRICS Countries are trying to move away from the Dollar while the USA stand by and watch is "OVER".

He emphasized that there is a requirement for commitment from these Countries that they will neither create a new BRICS Currency nor back any other Currency to replace the mighty U.S. Dollar.

If they do so, Trump said, "Or, they will face 100% Tariffs." He further warned these countries that they should expect to say goodbye to selling into the wonderful U.S. Economy.

"They can go find another "sucker!"," Trump wrote dramatically.

Lastly, he added that there is no chance that the BRICS will replace the U.S. Dollar in International Trade, and any Country that tries should "wave goodbye to America."

At present, the US dollar is predominately the world's foremost reserve currency and is widely held by central banks, foreign companies and even private individuals globally.

The dollar is also the standard currency in which countries quote the value of their trades of goods and services. In the global commodity markets, the dollar is used as the main currency to settle payments as well.

Central banks worldwide have huge reserves of US dollars in their holdings and are significant buyers of US treasury bills and notes. Foreign companies, entities and private individuals hold US dollars in foreign deposit accounts called euro-dollars (not to be confused with the euro), which are outside the jurisdiction of the Federal Reserve System. Private individuals also hold dollars outside the banking system mostly in the form of US$100 notes, of which 75% of its supply is held overseas, as per Wikipedia.

Who Are BRIC Countries?

The BRICS is a forum for cooperation among a group of leading emerging economies. They are a group of 9 countries such as Brazil, China, Egypt, Ethiopia, India, Iran, the Russian Federation, South Africa, and United Arab Emirates.

US Dollar Index:

Last week, US dollar erased its 106 mark, and plunged by around 1.5% for the five-trading sessions, making DXY's first weekly drop in nine weeks.

As per Trading Economics, the initial pullback was sparked by the nomination of Scott Bessent as US Treasury Secretary, which provided markets with a sense of stability and eased concerns over drastic policy shifts under the incoming Trump administration. The decline gained momentum on Wednesday after US PCE inflation data met expectations, signaling little change in the Federal Reserve's stance on interest rate cuts.

Further, Trading Economics, markets are now pricing in a 66.5% chance of a 25 basis point rate cut in December, up from 55.9% a week ago. Despite this week's drop, the dollar index is still poised to rise around 2% for November, as Trump's decisive election victory fueled bets on fiscal expansion, higher tariffs, and tighter borders-policies that could be inflationary.