Russia and Iran step up de-dollarization drive with pact to shun the greenback in bilateral trade, report says

• Russia and Iran have reportedly agreed to avoid the dollar in bilateral trade and use their own currencies instead.

• The move is seen as part of the de-dollarization trend among nations to shift away from using the greenback in trade and investment.

• Russia and Iran, both facing US economic sanctions, have been stepping up their cooperation.

Russia and Iran have entered into an agreement to avoid using the dollar in bilateral trade, relying instead on their own currencies, a new report says.

The central bank governors of the two nations sealed the pact at a recent meeting, Iran’s state media reported.

Russian and Iranian banks and companies can now use non-SWIFT messaging platforms and bilateral brokerage links to facilitate transactions in the ruble and rial.

Both Russia and Iran have been working to shift away from the dollar, after the US leveraged the greenback’s global dominance to slap economic sanctions on the two countries in recent years.

The move is also part of a wider drive among nations to reduce their reliance on the dollar in international payments and investments.

Countries from China to Brazil have been pushing to increase the global usage of their own currencies, while the BRICS group of nations has been weighing the possibility of a shared tender. More countries have joined the trend this year — Indonesia recently set up a task force to widen the use of its currency, the rupiah.

Russia and Iran, both facing US economic sanctions, have been steeping up economic cooperation.

Earlier this week, the Eurasian Economic Union — made up of Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan — signed a new trade deal with Iran, Reuters reported.

Read the original article on Business Insider