Definition of reserve currency in English:

reserve currency

noun

  • A strong currency widely used in international trade that a central bank is prepared to hold as part of its foreign exchange reserves.

    • ‘The dollar itself became an international reserve currency, which central banks were prepared to accept as payment in external dealings rather than insisting on payment in their own national currencies.’
    • ‘During the 1920s, the British Pound was overvalued and was used by smaller countries as a reserve currency.’
    • ‘The advantage for the United States in being an international reserve currency is that allows it to more easily run a trade deficit, as other countries are happy to hold dollars to finance its trade gap.’
    • ‘As this process goes on, the attractiveness of the Euro as a reserve currency and store of value will grow.’
    • ‘This may change if the world's central bankers one day decide they have outgrown their preference for a single reserve currency.’