WHAT IS A GLOBAL CURRENCY RESERVE? Officially speaking, a - TopicsExpress

WHAT IS A GLOBAL CURRENCY RESERVE? Officially speaking, a global reserve currency is what governments choose to store their foreign exchange reserves in – which is a wordy way of saying “this is the currency in which we will trade”. For example, let’s say that a Liberian company wants to import diamonds from Sierra Leone. Unfortunately, the Liberians only have the Liberian dollar to pay with. And the Sierra Leoneans would probably like to get paid in Sierra Leonean leone, because that’s what they use to pay the diamond miners.

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