The U.S. dollar is the world's dominant currency. However, amid rising geopolitical fragmentation, conflicts over international trade and finance, and populist backlash against globalization in many Western democracies, there is persistent speculation that the dollar's status is at risk. This post explains the role of the U.S. dollar in the global economy and the debate over its future. Reserves. Governments and central banks around the world hold dollar-dominated assets, usually U.S. Treasury debt, as reserves to manage the foreign exchange value of their currencies or weather economic shocks. Dollar assets comprise about 59% of global foreign currency reserves; the next largest share is the euro at 20%.
Authors
- Acknowledgements and disclosures
- The Brookings Institution is financed through the support of a diverse array of foundations, corporations, governments, individuals, as well as an endowment. A list of donors can be found in our annual reports published online here. The findings, interpretations, and conclusions in this report are solely those of its author(s) and are not influenced by any donation.
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- 9
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- United States of America
Table of Contents
- How is the dollar used abroad 1
- COMMENTARY 1
- Sam Boocker and David Wessel 1
- August 23 2024 1
- US Europe UK Japan China CN Other 2
- Why is the dollar the worldʼs dominant currency 2
- What are the benefits and costs of a dominant dollar for the U.S. 3
- Is the dollar losing market share 4
- Percentage of total reserves by currency 5
- 2000 2005 2010 2015 2020 5
- Dollar US Euro Europe Yen Japan Pound UK Other 5
- Percentage of global reserves by currency 6
- 2000 2005 2010 2015 2020 6
- Total Nontraditional 6
- Other Other Currencies Currencies 6
- Renminbi Renminbi China China 6
- Dollar Dollar Australia Australia 6
- Franc Franc Switzerland Switzerland 6
- Dollar Dollar Canada Canada 6
- Is the dollar destined to lose its dominance 6
- What are the challenges to dollar dominance 7
- AUTHORS 9
