HOW U. S. DOLLAR BECAME KING OF CURRENCIES AND MOST USED CURRENCY ???


In this article we tell about how dollor become international currency and how dollor is getting stronger than other currencies. In this topic we will also learn how dollor value calcuted,in addition how dollor value changes. We wanted to make a family who knows about the India and other countries. Hope you will enjoy this article 


 The first U.S. dollar (USD) is one of the world's strongest currencies. It is the official currency of the United States as well as several other countries. Although it has a deep-rooted history in the United States, the dollar as we know it today was first printed in 1914.

In world war 1st ,Allies wanted supplies so they bought from U.S by giving gold so the U.S become the largest  holder of gold .

After the war, because of ending gold standard the other countries bank adopted the U.S dollor
It is the starting of the U.S dollor to became the bank reserves But in the global market the dollor isn't the world's strongest currency it is ranking on 10th position.

The majority of developed countries pegged their currencies to gold as a way to stabilize currency exchanges. But when World War I broke out in 1914, many countries suspended their use of the gold standard to pay their military expenses with paper money, which devalued their currencies.
Before the Bretton Woods Agreement of 1944, most countries of the world set the exchange rate of their native currency as per the value of gold. But when the Bretton Woods Agreement of 1944 taken place; dollar get a good recognition and member countries agree to set exchange rate of their currency in terms of dollar.

 The relative strength of the U.S. economy supports the value of the dollar. It's the reason the dollar is the most powerful currency Almost 40% of the world's debt is issued in dollars. As a result, foreign banks need a lot of dollars to conduct business.

 Federal Reserve had to increase its dollar swap line. That was the only way to keep the world's banks from running out of dollars.
The financial crisis made the dollar even more widely used. Because of this the banks of Germany, France and great Britain have more liabilities in dollor than their own currencies

The value of US dollar don’t fluctuate often that is the reason every country of the world accept dollar without any hesitation.

If two Non-American countries also trade with each other, they prefer to take US dollars in payment because they know that if they have dollars in their hands, they can import goods from any other country any time. 

America is the world's biggest economy, due to which it lends many poorer countries in the US dollar and receives the repayment in the same currency that is why the demand of dollar in the international market exists throughout the  year.  

world institutions lend money to its members in the US dollar, which further increases the faith of the lenders in the US dollar.

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