The dollar’s share of global foreign exchange reserves fell from 64% in 2015 to 56% in 2025, according to IMF data. However, a study by the Federal Reserve Bank of New York reveals this decline is not the result of a broad-based retreat but primarily driven by decisions from a handful of large reserve managers, namely China, Russia, Mexico, and Morocco. The analysis separates the active preferences channel, which measures intentional decisions by central banks, from mechanical reserve changes. Between 2019 and 2023, the active preferences channel actually showed a slightly positive contribution of 0.3 percentage points toward dollar holdings, indicating that most central banks marginally increased their dollar exposure. The 56% share remains historically low and worth watching, but the decline is concentrated rather than diffuse.
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