Richest families rethink dollar exposure as geopolitical risks rise

The world’s richest families are starting to pull back from the dollar, with about two-thirds of family offices surveyed by UBS saying confidence in the U.S. currency as a reserve asset will weaken over the coming year. The shift came from clients with an average net worth of $2.7 billion, underscoring that the recalibration is happening at the top end of global capital as geopolitical tensions and rising sovereign debt reshape how wealthy investors think about safety.

The survey, which covered 307 clients worldwide, was conducted between January and late March, before the dollar began outperforming many peers. That timing matters: it captured attitudes formed during a stretch of market uncertainty, when investors were looking less at short-term currency momentum and more at the longer-term risks of concentration in U.S.-linked assets. UBS said nearly half of respondents believed they were overexposed to dollar-denominated holdings across asset classes.

That sense of overexposure was translating into concrete portfolio changes. Many family offices said they planned to reduce real estate holdings while increasing allocations to emerging-market stocks and infrastructure, a sign that capital was not simply leaving the dollar but moving toward assets tied to different growth cycles and political systems. Benjamin Cavalli, a UBS executive, said the bank was seeing family offices outside the United States build up positions in Asia Pacific and, to a lesser degree, Western Europe. UBS also said some were pairing portfolio shifts with multishoring, spreading operations across several jurisdictions to reduce exposure to any single country’s regulatory or geopolitical risk.

The biggest concern, UBS said, was geopolitical conflict, by a wide margin. That is a notable change in emphasis because it points to a broader anxiety than ordinary market volatility: wealthy investors are weighing war risk, trade disruption, sanctions exposure and the possibility that sovereign balance sheets, including America’s, become less predictable over time. Rising debt was another pressure point, feeding doubts about how far fiscal strain can build before it affects currency confidence.

The broader signal is not that the dollar is losing reserve-currency status overnight. It is that some of the most sophisticated private capital in the world is reducing its dependence on a single-currency bet, and doing so at a moment when conflict, debt and policy volatility are all moving higher.