Reserve currency

The currency at the centre of international trade and reserves

In detail

Trade is settled in it and central banks hold it in their reserves. Because oil and grain are priced in it, countries use it even when neither side issues it. The issuing country raises money easily, but its monetary policy then moves capital flows across the world.

Example

The leading currency alone accounts for roughly 6 out of every 10 units of global reserves.

Related terms

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