2025-07-08
At the July 2025 BRICS Summit in Rio, leaders confirmed that no joint currency would be launched in the near term. Instead, they prioritized expanding local-currency trade and developing BRICS Pay, a cross-border payment platform. Experts suggest any euro-style BRICS currency is at least a decade away, given the need for political alignment, fiscal stability, and central bank cooperation. Traders should watch for incremental steps, such as swap-line agreements, CBDC pilots, and settlement in yuan and rupees, as the real “first phase” of BRICS monetary integration.
Below is an up-to-date assessment of the project, why delays persist, and what traders should watch next.
The 17th BRICS summit, hosted by Brazil on 6–7 July 2025, drew intense speculation that a launch date might finally emerge. Instead, leaders delivered a familiar message: closer monetary co-operation, yes; a single currency, not yet.
Key outcomes:
No unified BRICS currency was announced.
Leaders pledged to “continue technical discussions” on payments.
BRICS Pay—a shared cross-border payment platform, remains “under development”, with Brazil taking responsibility for the next phase.
India stressed the bloc is “not conspiring to undermine the dollar”, easing some geopolitical tension.
Russian officials confirmed progress on settling trade in local currencies rather than US dollars.
Bloomberg captured the mood with a telling headline on 6 July: “The decade-old local-currency push by BRICS is still a pipe dream.”
Indonesia formally joined the group on 6 January 2025, bringing total membership to ten:
Brazil, Russia, India, China, south africa, Egypt, Ethiopia, Indonesia, Iran and the UAE.
The larger bloc strengthens trade heft but adds complexity to any monetary union. GDP sizes, inflation rates and fiscal regimes vary even more widely than before, complicating convergence.
While a single currency remains distant, intra-BRICS trade is increasingly dollar-free. According to data released at the summit, about 90% of commerce among BRICS nations is now settled in local currencies, up from roughly 65% two years ago. This sharp jump reflects:
Energy deals priced in yuan or roubles.
Indian rupee-denominated trade corridors with Russia and UAE.
A surge in bilateral swap lines that bypass SWIFT.
For traders, the shift creates new liquidity pockets in EMFX pairs and reduces outright USD demand in certain commodity invoices.
First proposed in 2019, BRICS Pay aims to link national fast-payment networks and eventually support CBDC transfers. Contrary to earlier rumours, the platform is not live. Russian Foreign Minister Sergey Lavrov said in Rio that the project “will be continued by our Brazilian successors” and that a pilot could appear “before the end of 2026”. Until then, expect only incremental testing.
1. Economic Divergence
The BRICS-10 span everything from China's $17 trillion economy to Ethiopia's $150 billion output. Inflation ranges from low single digits in the UAE to double digits in Egypt. Aligning monetary policy under one roof would require unprecedented fiscal co-ordination and a supranational central bank—neither exists.
2. Political Sovereignty
Ceding control of interest rates and money supply is politically sensitive, especially for India, Brazil and South Africa, which have deep domestic capital markets and floating currencies. Beijing's yuan-internationalisation agenda also competes with the idea of a brand-new unit.
3. Legal and Technical Hurdles
Capital-control regimes differ sharply.
No shared deposit-insurance or banking-resolution framework is in place.
FX-clearing infrastructure would need to handle ten jurisdictions and multiple script systems.
Geopolitical Ripple: Tariff Threats from Washington
The summit spurred a swift response from the United States. President Trump warned of an additional 10% tariff on countries “aligning with anti-American policies of BRICS”. While largely rhetorical at this stage, the threat adds an extra layer of uncertainty for exporters within the bloc and could stoke EMFX volatility.
1. Currency Pairs to Watch
CNY/RUB, INR/CNY and ZAR/CNY volumes continue to rise.
USD/BRL and USD/ZAR may see episodic weakness as local-currency settlement grows.
Synthetic baskets: desks now quote a “BRICS-10 index” (equal-weighted) versus USD for hedging.
2. Rates and Bonds
Local-currency bond issuance by BRICS development banks is likely to expand, offering relative-value opportunities against US Treasuries. Watch yield-spread compression in yuan- and rupee-denominated green bonds.
3. Commodities
Russian oil sold in yuan or roubles changes quoting conventions for Urals.
Gold hubs in Dubai and Shanghai are exploring BRICS-pay settlement pilots, potentially shifting LBMA liquidity eastward.
4. Equity Themes
Payment-system providers, regional clearing houses and AI-driven FX-matching engines may benefit as cross-border flows in non-dollar pairs scale up. Conversely, export-heavy firms in BRICS-10 could face US tariff risk premia.
Headline Shock: Summit rumours can whipsaw EMFX quotes; keep tight stops during BRICS meetings.
Liquidity Gaps: Some BRICS cross-pairs remain thin; use limit orders and beware of weekend gaps.
Geopolitical Escalation: Monitor tariff announcements or sanctions that could freeze payment-system progress.
Regulatory Shifts: CBDC frameworks evolve quickly—check local capital-control changes weekly.
Data Quality: Macro statistics from smaller BRICS members can be revised heavily; build buffers into models.
Event-Driven Volatility Trades: Straddles around future BRICS summits or NDB announcements.
Carry-and-Roll: Short-tenor swaps exploiting higher local rates in India and Brazil versus low-yield currencies.
Relative-Value Bonds: Long on NDB real-denominated issuance hedged with US dollar bonds of similar duration.
Thematic Equity Baskets: Payment-rail developers, emerging-market infra plays and regional commodity exchanges.
The BRICS currency is a proposed common monetary or digital settlement unit among Brazil, Russia, India, China, and South Africa. It does not exist yet. Current efforts focus on expanding trade in local currencies and building BRICS Pay, a payment platform, rather than launching a euro-style union currency.
BRICS Pay is a proposed cross-border payments platform to link national fast-payment systems and eventually support CBDC traffic. It remains under development; leaders agreed ongoing pilots and reporting to the next summit, but no public, full launch date has been set.
Expect gradual, technical forms first: a synthetic basket or payments unit, CBDC interoperability, or a digital settlement token, not an immediate sovereign currency swap. Any move will start as settlement infrastructure and evolve only if political and economic convergence allows it.
A formal BRICS currency could reduce dollar invoicing in targeted corridors and commodity deals, but it is unlikely to dethrone the dollar soon. The dollar’s deep capital markets, liquidity and safe-asset status mean displacement would be gradual and geographically uneven.
Barriers include large GDP and inflation differences, reluctance to cede interest-rate control, divergent capital-control regimes, lack of a supranational central bank, no shared deposit-insurance system and heavy legal/technical integration needs, all politically sensitive for sovereign states.
Trade the process: monitor BRICS Pay pilots, CBDC link tests and swap lines. Hedge via EM local-currency bonds, watch CNY/RUB and INR/CNY flows, use limit orders for thin cross-pairs, and stress-test models for tariff or sanction headlines around BRICS summits.
Large exporters and deep-market economies like China, Russia and India get immediate gains through cheaper bilateral settlement and liquidity creation. Smaller members can benefit via swap lines and NDB financing, but benefits depend on local market depth and regulatory reforms.
BRICS are more likely to prioritise CBDC interoperability and a payments backbone than a single sovereign CBDC. Linking national CBDCs via BRICS Pay or a settlement layer is the pragmatic near-term route to faster, cheaper cross-border trade.
The 90% figure mainly reflects Russia’s reported share of its BRICS settlements and stronger ruble/yuan corridors; it does not imply every BRICS bilateral corridor is 90% local-currency. Independent metrics vary by pair and corridor; the trend toward more local settlement is clear, but not uniformly absolute.
BRICS Pay aims to reduce dollar-rail dependence, but fully bypassing SWIFT or insulating sanctioned entities is politically and operationally difficult. Any viable alternative needs broad bank connectivity, compliance frameworks and member consensus to avoid isolation or countermeasures.
A euro-style union is a multi-decade prospect. It requires fiscal transfers, legal harmonisation, labour mobility and political willingness to cede monetary sovereignty, conditions BRICS members currently avoid. Expect incremental payment and settlement steps over 3–10 years, not immediate monetary unification.
So, when will a BRICS currency be released? The honest answer remains: not anytime soon. The July 2025 summit confirmed that member states are prioritising payment connectivity and local-currency trade, not a bold leap to a euro-style union.
For traders, the richer opportunity set lies in tracking incremental progress, BRICS Pay pilots, CBDC links, swap lines, and positioning for shifts in FX flows, commodity pricing and bond issuance, rather than betting on a single launch date that keeps moving further into the future.
Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
