U.S. Dollar’s Share in Currency Reserves Declines to 25-Year Low

The U.S. Dollar (USD) share of global currency reserves declined to its lowest level since 1995 during the fourth quarter (Q4) of 2020, according to data by the International Monetary Fund (IMF) released on Wednesday.

However, the USD continued to account for more than half of currency reserves, reaching a share of 59% in Q4 of 2020, compared with 60.5% in Q3 of last year.

The change marked three consecutive quarters of decline in the Dollar’s portion, reaching its lowest level since it recorded 58% of currency reserves in 1995. On the other hand, its highest level was at about 73%, registered in 2001.

Alternatively, the Euro (EUR) saw an increase in its share of global currency reserves to 21.2% in Q4, from 20.5% in Q3, reaching its highest level since 2014.

The EUR registered its highest share of currency reserves in 2009 at 28%.

Meanwhile, the Japanese Yen (JPY) and the Chinese Yuan (CNY) accounted for 6.03% and 2.25%, respectively.

It is worth noting that IMF data further showed that global reserves hit a record high of $12.7 trillion by the end of last year.