Sterling's Past, Dollar's Future: Historical Perspectives on Reserve Currency Competition, Issue 11336
This paper provides an historical perspective on reserve currency competition and on the prospects of the dollar as an international currency. It questions the conventional wisdom that competition for reserve-currency status is a winner-take-all game, showing that several currencies have often shared this role in the past and arguing that innovations in financial markets make it even more likely that they will do so in the future. It suggests that the dollar and the euro are likely to share this position for the foreseeable future. Hopes that the yuan could become a major international currency 20 or even 40 years from now are highly premature.
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assume back cover banker banks and governments Barry Eichengreen Bloomfield 1963 bonds Britain century China Chinese colonies convertibility currency of denomination current account deficit decades deep and liquid deposit account Dollar's Future dominant Economics euro exchange rate export financial system foreign central banks Foreign Exchange Markets foreign exchange reserves French franc German mark Gold Pool growth hard copy higher interest rates hold reserves international currency international financial center international reserves investors invoicing Linder liquid foreign London Lu Zhang macroeconomic maintained market liquidity monetary NBER Working Papers network externalities Number official foreign papers in hard partial subscription percent of GDP Perspective on Reserve portfolios ratio renminbi Reserve Currency Competition reserve currency country reserve currency role reserve currency status reserve-currency reserves in dollars share single area stability sterling area sterling reserves Sterling's Past store of value U.S. corporations U.S. government U.S. inflation U.S. treasury securities United