The Future of the U.S Dollar as the World Key Currency
The US dollar is used as a standard currency across the globe. Since its inception, it has encountered many issues before the Bretton woods institution was found. Earlier, the Bretton woods institution had replaced the US dollar when it served as the major currency. As a result, this form of cash has continued to take control of business and transaction across the globe.
Currently, the US dollar serves as the major currency that individuals use to pay their goods and services. In these recent days, the dollar has met the worst crisis financially. This took place during the outsourcing activity that incorporated production abroad. It has raised questions if the US dollar form of currency will enhance its status. This is if it applies as the major cash that will be used around the world. There are different explanations that reveal how the US dollar will dominate the globe.
Clearly, there is no other form of currency that is capable of replacing the US dollar. In contrast to various currencies, US dollar is coordinated in an appropriate manner. Furthermore, it is the best because it cannot be manipulated in an easy manner. In this regard, Yuen is also another form of currency that the world could make it its major. This is because, it is popular and it has made China’s economy to be strong (Ivanova, 2013). The euro could also be the best but is rigid and it incurs crisis.
Gold is a threat that could eliminate the power of US dollar. This is because it has depicted increase in its prospects in relation to its vitality compared to the dollar. The business weighted index reveal that the US dollar has managed to retain flexibility and stability besides facing financial crisis. As a result, the US dollar currency has been accepted as the major form of transaction across the globe.
Ivanova, M. N. (2013). The Dollar as World Money. Science & Society, 77(1), 44-71. doi:10.1521/siso.2013.77.1.44
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