The retirement of Sterling as a Reserve Currency after 1945: Lessons for the US Dollar?

Abstract

The global reserves system is coming under increased scrutiny both as a contributor to the global crisis and as a threat to future stability. This article examines how the change from sterling to the US dollar as the primary reserve currency was achieved without a major crisis in the international monetary system. It concludes that the process was carefully (and expensively) managed by the G10 group of economies.