TRADING GLOSSARY
Reserve currency
A reserve currency is a foreign currency held by central banks and other monetary authorities as part of their reserves. It is typically widely accepted for international payments and investment, and reserves may support currency intervention or external payment needs.
EXAMPLE
In an illustrative scenario, a central bank holds US-dollar assets in its reserves and sells some of them to obtain funds for currency intervention.
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Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Glossary definitions are general education only and are not investment advice. Risk disclosure