World Currencies: Comparative Analysis in Context of Monetary Functions

DOI: 10.20542/0131-2227-2018-62-8-26-34

I. Kudryashova (, 
Volgograd State University, 100, Universitetskii Pr., 400062, Volgograd, Russian Federation 

Abstract. The creation of the conditions influencing a high international demand for a monetary unit providing its stability and also the opportunity of use by non residents contribute to its use in the world as a unit of account, means of payment and store of wealth. In the article the conditions of the achievement by national (common) monetary units of the USA, euro zone, Great Britain, Japan and China of the status of world currencies are studied. The role of the US dollar, euro, pound sterling, Japanese yen and yuan in the process when fulfilling the functions of money beyond the countries’ (country unions) boundaries that issue them is shown. The conclusion is made about an incomplete conformity of contemporary conditions determining the demand of non residents for a common European and Chinese national currency judging from the volumes of their use by the agents of the world market. On the basis of the comparative analysis of the volumes of the transactions with modern world currencies the primary role of the US dollar, euro, pound sterling, Japanese yen and Yuan as a unit of account at the creation of the demand for them, their role as means of payment and also a store of wealth are proved. It is shown that a further internationalization of monetary functions of a common European unit and the national currency of China is possible on the basis of the conservation of the euro zone unity, achievement of a complete convertibility of the yuan and also under the condition of the development of the financial market of China. The conclusion is made about a long-term character of this prospect what is connected with the necessity of a partial reorientation of the choice of the agents of the world market continuing to use by inertia the US dollar as the only world currency. The suggestion is made to move in the direction of a wider use of the euro and the yuan as a standard of value, a means of payment and a reserve instrument. 

Keywords: world currency, functions of world currencies, currency rate regime, currency interventions, international reserves, currency market 


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For citation:
Kudryashova I. World Currencies: Comparative Analysis in Context of Monetary Functions. World Eonomy and International Relations, 2018, vol. 62, no. 8, pp. 26-34.

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