Over the first half of the year, the Bloomberg Dollar Index has fallen nearly 8.5 percent, marking one of the sharpest declines since the mid-1980s. Yet while this drawdown has fueled widespread commentary about de-dollarization, it is important to distinguish between dollar weakness — a familiar, cyclical phenomenon — and the far more consequential and complex issue of de-dollarization, which concerns the dollar's standing as the world's primary reserve currency and medium of international exchange.

Bloomberg Dollar Spot Index & US Dollar Index Spot Rate, 2023- present

(Source: Bloomberg Finance, LP)