Union College Union | Digital Works Honors Theses Student Work 6-2019 The hiS fting Dynamics of International Reserve Currencies Robert Righi Union College - Schenectady, NY Follow this and additional works at: https://digitalworks.union.edu/theses Part of the International Economics Commons Recommended Citation Righi, Robert, "The hiS fting Dynamics of International Reserve Currencies" (2019). Honors Theses. 2342. https://digitalworks.union.edu/theses/2342 This Open Access is brought to you for free and open access by the Student Work at Union | Digital Works. It has been accepted for inclusion in Honors Theses by an authorized administrator of Union | Digital Works. For more information, please contact
[email protected]. The Shifting Dynamics of International Reserve Currencies by Robert Righi * * * * * * * * * Submitted in partial fulfillment of the requirements for Honors in the Departments of Economics and Mathematics UNION COLLEGE June 2019 Acknowledgement Thank you to both Professor Wang and Professor Motahar for their incredible support throughout the process of this work. The dedication to their students will forever be appreciated. This study would not have been at all possible without their guidance and thoughtful contributions. ii Abstract RIGHI, ROBERT J. - The Shifting Dynamics of International Reserve Currencies ADVISORS - Eshragh Motahar and Jue Wang Throughout most of post World War II period, the United States dollar has been globally accepted as the dominant reserve currency. This dominance comes with “exorbitant privilege” or special benefits such as not having a balance of payments problem. Therefore, with the shifting of global geopolitical balance of power in the age of Trump, along with the recognition by the IMF of the Chinese renminbi as an international reserve currency in 2015, it is important to understand the modern influence of reserve currencies.