US Treasury Secretary Bessent says that the USD continues to thrive in global transactions; decrease in reserve holdings is mainly from Russia and China

On-the-record Treasury commentary defending the dollar's reserve role is a recurring feature of periods when reserve-manager diversification is in the headlines, and the framing here is notable: attributing the decline in USD holdings to Russia and China recasts it as geopolitically driven rather than a broad loss of confidence, the distinction that has historically separated one-off sanctions-related reallocation from genuine reserve diversification. Reserve-share data move at glacial pace and official rhetoric of this kind has rarely shifted the DXY on its own; what has mattered in past episodes is whether the policy behaviours invoked, fiscal consolidation, tax and trade certainty, are actually delivered, since reserve managers respond to trajectories rather than statements. The fiscal consolidation line is the more market-relevant thread, as it ties the currency narrative to the supply outlook for Treasuries and therefore to term premium rather than to FX directly. Worth noting is that Treasury secretaries invoking a strong dollar as a set of behaviours, rather than as a level target, is the modern formulation of the long-standing strong-dollar mantra, a formula previous occupants of the office have used to signal policy stability without committing to intervention. Follow-ons are the periodic official reserve-composition data and any concrete fiscal proposals that would test the consolidation claim. As rhetoric rather than action, the signal is continuity.