The International Monetary Fund has begun a new era in world money after creating a multi-currency reserve system, starting with the world’s leading commodity-rich currencies the Australian Dollar and Canadian Dollar.
The move is the first stage in the IMF’s attempt to reflect the growing diversification of the globe’s $10.5 trillion of reserve cash. The organisation has asked member country’s to include the Australian Dollar in statistics supplied by reserve-holding nations on the composition of their foreign exchange reserves.
The move will see the current stable of five reserve assets expand to seven. Currently the five are the Dollar, Euro, Sterling, Yen and Swiss Franc. The move to add new currencies is a big shakeup to the long standing reserve currency system which for most of the past 150 years saw only two currency’s the Pound and US Dollar dominating. Before World War One Sterling was the leader and the Dollar took up the mantle and became the leading reserve for the past 100 years.
The move has made official what many reserve traders and private markets have been doing for a while with the moves making it official as they catch up with reality. The global economic crisis has paved the way for the Canadian and Australian Dollars which have both proven to be relatively strong in the midst of a dangerous period for the world economy. Both have strengthened against the US Dollar over the past few years, reflecting their stability and robust banking systems in the face of crisis. Currently, reserve holdings of the two currencies are probably about $60billion.
There are no Asian currencies apart from the Yen on the new IMF list, reflecting their still very low use as official assets. However the Chinese Yuan is attracting widespread attention as a possible future reverse currency.
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The Pound to Euro exchange rate is currently trading at 1.2426
The Pound to US Dollar exchange rate is currently trading at 1.5920
The Pound to Australian Dollar exchange rate is currently trading at 1.5313
The Pound to New Zealand Dollar exchange rate is currently trading at 1.9482
The Pound to Canadian Dollar exchange rate is currently trading at 1.5869
The Pound to Emirati Dirham exchange rate is currently trading at 5.8459
The Pound to Swiss Franc is currently trading at 1.4978
The Pound to Japanese Yen exchange rate is currently trading at 129.5400
The Euro to US Dollar exchange rate is currently trading at 1.2810
The Euro to Pound exchange rate is currently trading at 0.8043
The Euro to Australian Dollar exchange rate is currently trading at 1.2317
The Euro to New Zealand Dollar exchange rate is currently trading at 1.5670
The Euro to Canadian Dollar exchange rate is currently trading at 1.2750
The US Dollar to Pound exchange rate is currently trading at 0.6285
The US Dollar to Euro exchange rate is currently trading at 0.7821
The US Dollar to Canadian Dollar exchange rate is currently trading at 0.9970
The US Dollar to Australian Dollar exchange rate is currently trading at 0.9612
The US Dollar to New Zealand Dollar exchange rate is currently trading at 1.2229
The US Dollar to Japanese Yen exchange rate is currently trading at 81.1800
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