Key currency

A currency that is preferably used in international transactions (a currency used ordinarily in international transactions), such as currently the USD and the EUR. – A currency that other countries align with when using their own currency and usually coincides with the currency used in global transactions. The alignment happens mainly by – fixing the exchange rate of the domestic currency against this reserve currency, – having the domestic central bank more or less directly align its monetary and interest rate policy decisions with the corresponding decisions of the reserve currency country or align its policy with them and also – holding its own currency reserves in good part in this money (central banks hold key currencies in their reserve). – In order to be able to function as a key currency, the corresponding money must be – fully convertible, – free from any kind of restriction on the foreign exchange markets, – have a corresponding monetary home and – there should also be a considerable social product behind this currency. – Lead currencies in this sense are at present practically likewise the USD and the EUR. – See Eurodollar, money home, escape money, money, hot, harbor, safe, leading rate.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
https://de.wikipedia.org/wiki/Gerhard_Ernst_Merk
https://www.jung-stilling-gesellschaft.de/merk/
https://www.gerhardmerk.de/