If we talk about world currencies, The dollar tops all the lists as the reference currency. And it is no wonder, since it has managed to consolidate itself as the main reserve currency and a key piece in global trade.
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However, its leadership has lost strength in recent years as more and more central banks have chosen to diversify their holdings with the inclusion of other currencies or assets. A trend that in the process has led to the ‘greenback’ losing some weight against other currencies.
The dollar’s loss of momentum in global reserves is evident in the most recent data from the Currency Composition of Official Foreign Exchange Reserves (Cofer) of the International Monetary Fund (IMF). According to the latest report, in the second quarter of 2024 a 58.2% drop in reserves was recorded of international issuers.
In fact, experts estimate that this figure could continue to decline, as more countries seek to reduce their dependence on the US currency in a context of economic uncertainty and geopolitical tensions. Forecasts suggest that in the next decade the level could fall by close to 50% if it continues at that rate.
(Read more: The direction the dollar would take in the coming months, according to analysts)
Dollar.
EFE
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Other reserve currencies
In addition to the dollar, there are other currencies that are part of the list of the main international reserve currencies. This includes the euro, which has managed to remain stable in the last 10 years.
According to the Cofer report, the share of this currency to reserves is 19.6%. Followed by the Japanese yen (5.6%), the British pound (4.9%), Canadian dollar (2.7%), Australian dollar (2.2%) and the Chinese renminbi (2.1%).
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