World Reserve Currency
The Reserve Currency is the currency held and used most in Foreign Exchange Reserves. Since the end of World War II and with the Bretton Woods Agreement in 1944, the USA’s Dollar has been the World’s Reserve currency. As the World’s Reserve currency it comes with certain benefits and responsibilities. One of the biggest factors being trust and stability. If your country wants to hold value in a currency, especially a Fiat currency, it must trust that the value will remain stable and secure. As such, it is not surprising that generally the World Super Power has held the position of reserve currency holder. This is true across history from Roman times, to Spain’s zenith, and the rise of the British Empire, and now America. As the power of nations ebb and flow, so does their status as the holder of the Reserve currency.
