Karthik Sankaran, a geoeconomics fellow at the Quincy Institute, discusses the recent US-Japanese intervention to support the yen, arguing that intervention criteria have been met due to potential spillovers in global bond markets and threats to global trade. He advocates for more frequent currency interventions, noting that currencies frequently overshoot.

Sankaran also addresses global imbalances, positing that while renminbi undervaluation contributes, US healthcare spending (17% of GDP, a significant outlier) is a major counteracting factor. He distinguishes between dollar strength and dollar centrality, asserting that the dollar's role in the international financial system since 1971 does not equate to persistent strength, which he attributes more to the shale revolution.

He expresses concern over the selective use of the dollar system as a tool of US power, particularly its impact on global south countries. Regarding the renminbi as an alternative to the dollar, Sankaran believes it is well-positioned as a trade currency but not yet ready to replace the dollar as a liability currency in global capital markets at scale.