New Delhi, May 15 -- A global reserve currency is one that is extensively held by foreign Central Banks. Since the 1944 Bretton Woods agreement this position has been occupied by the US dollar and it still holds true - according to IMF data from late 2024, the dollar represented 54% of global official reserves, while the euro came in a distant second at 19%.

The concept of money was historically underwritten by valuable assets. This is no longer the case, as today we use fiat money: essentially paper with a stamp from a legal authority.

However, nothing precludes people from using other commodities as currency. One well-known example occurred during the Second World War, when cigarettes were widely used as money in prison camps.

Money...