What is the world currency?

The world currency usually refers to a specific currency used by investors and others to carry out international trade. World currencies have evolved from gold in the mercantilist period of the 16th century to the US dollar in the 20th century. These currencies are held in reserve companies and governments to overcome foreign trade barriers. Nations that are responsible for printing world currencies are often considered to have a hegemony or control over the global economy. Critics of cash hegemony have proposed a single global currency to replace the currencies printed by individual nations.

The development of the world's currency idea depended on the shifts of power throughout history. Gold was considered a world currency for European and Asian traders in the 16th century. The dominance of the British Empire starting at the 17th century was responsible for the rise of the British pound. This global currency was slowly replaced by the US dollar after the Second World War in 1945. The world's currencies since the mid -20th century included the euro of the European Union, the JapaneseJeny and Chinese Juan.

International traders and investors often look for world currencies to avoid fees associated with monetary stock exchanges. For example, the euro can be held by an international stock exchange that is mainly engaged in European companies. Investment companies that process transactions for popular commodities such as oil, gold and coal often do business in world currency. National governments with weak currencies can do business in the world currency offered by the stronger national economy. All these world currencies are interested in fast and cheap transactions without complicated currency swaps.

Economy that prints frequently used currency can benefit from this condition in this condition in several ways. Extensive use of currence often supports business agreements on new markets. Extensive use of the world's currency can streamline purchases of shares, acquisitions of companies and other investments of the currency provider. InternationalAgencies and exchanges that use world currencies can allow national leaders to influence the global economy. This informal instructions may include the rules of free loans of international banking groups and a reduction in tariffs by regional governments.

This situation was not popular among economists who were worried about one nation that effectively controlled global trade. These opponents of monetary hegemony usually say that the world currency pays power from most national economies. An alternative proposed criticism at the end of the 20th century was a "multinational" currency that would eliminate currencies printed by individual nations in favor of a single currency common to all nations. These supporters would believe that this single currency would eliminateamanipulation with individual currencies and fluctuating exchange courses.