Board of Governors of the Federal Reserve System
12/16/2025 | Press release | Distributed by Public on 12/16/2025 15:56
Dollarization Waves: New Evidence from a Comprehensive International Bond Database
December 2025
Dollarization Waves: New Evidence from a Comprehensive International Bond Database
Swapan-Kumar Pradhan, Eswar Prasad, Előd Takáts, and Judit Temesvary
Abstract:
We investigate how the U.S. dollar's prominence in the denomination of international debt securities has evolved in recent decades, using a comprehensive global dataset with far more extensive coverage than datasets used in prior literature. We find no monotonic dollarization or de-dollarization trend; instead, the dollar's share exhibits a wavelike pattern. We document three dollarization waves since the 1960s. The last wave, following the global financial crisis, lifted the dollar's share nearly back to its level at the euro's launch in 2000. Our findings are robust to composition and currency valuation effects as well as alternative data definitions.
Keywords: International debt securities, currency denomination, nationality and residence basis, reserve currencies, banks, nonbank financial institutions, nonfinancial corporations
DOI: https://doi.org/10.17016/IFDP.2025.1429
PDF: Full Paper
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