The dominance of the U.S. dollar has long been a subject of scrutiny, but Franklin Templeton maintains that it will remain the preferred global currency. Sonal Desai, Chief Investment Officer of the firm's fixed income division, stated in a report that the dollar's status rests on three key pillars: the scale of the world's largest economy, the depth of its financial markets, and institutional credibility. She added that no credible alternative currently exists, and establishing the institutional infrastructure necessary to support a rival currency would take decades.

Amid growing debate over the dollar's hegemony, fueled by unpredictable trade, geopolitical, and fiscal policies under former U.S. President Donald Trump, which have diminished the appeal of U.S. assets, some analysts have pointed to the euro, gold, and digital assets as potential competitors for reserve asset status. Desai wrote, "The eurozone is unable to issue a unified safe asset on a sufficiently large scale. In my view, a true competitor to the dollar has yet to emerge."

Desai highlighted that according to the Bank for International Settlements' triennial survey data for 2025, the U.S. dollar accounted for as much as 89% of over-the-counter foreign exchange trading volume. She noted that the current weakness of the dollar is cyclical rather than structural. On a real trade-weighted basis, the dollar remains well above its lows from the mid-1990s and late 2000s, and a certain degree of dollar softness is consistent with its role as the global reserve currency.