Central bank reserve holdings play a critical role in stabilizing domestic currencies, facilitating international trade settlements, and managing financial stress during periods of crisis.
This overview ranks the world’s leading reserve currencies and illustrates how global foreign exchange reserves are currently allocated. The data is sourced from the International Monetary Fund’s COFER (Currency Composition of Official Foreign Exchange Reserves) database, with reserve values reported in nominal USD terms.
The US dollar still dominates global reserves
The US dollar remains the cornerstone of the global reserve system. Central banks collectively hold around $6.6 trillion in dollar-denominated assets, accounting for nearly 58% of total reported global reserves.
Despite ongoing debate around de-dollarization, the dollar continues to benefit from the depth and liquidity of US financial markets, its widespread use in global trade invoicing, and its role as a safe-haven asset during periods of heightened uncertainty. These structural advantages have helped sustain the dollar’s dominance even as geopolitical and monetary dynamics evolve.
The euro remains the primary alternative
The euro ranks second among global reserve currencies, with holdings of roughly $2.3 trillion, representing close to 20% of total reserves. It remains the only currency that comes close to challenging the dollar’s position, supported by the size of the euro area economy and the depth of its financial markets.
Beyond the dollar and the euro, reserve allocations become far more fragmented. The Japanese yen and the British pound together account for around 11% of global reserves, reflecting their long-standing roles in international finance, institutional credibility, and stable monetary frameworks.
Smaller currencies hold marginal shares
Other reserve currencies hold comparatively modest positions. The Canadian dollar, Australian dollar, Chinese yuan, and Swiss franc each represent only small portions of total reserves.
Notably, despite China’s growing influence in global trade and its efforts to internationalize the yuan, the currency still accounts for just over 2% of global reserve holdings. This highlights the gap between trade prominence and reserve currency status, which remains closely tied to capital market openness, liquidity, and investor confidence.
Overall, the current reserve currency landscape underscores the continued dominance of the US dollar, the euro’s role as the main alternative, and the limited progress of other currencies in reshaping the global reserve system.
Ready to start trading Forex? Join iXBroker today and kick-start your trading journey now!
