About US dollars
Modern economy can not exist without all sorts of trading operations.
When it comes to economic cooperation in different countries, then one of the most important issues is which precisely currency will be applied to calculations between them.
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What is one or another currency? What are the varieties of currencies?
As an example, you can specify not only gold or precious stones, and, for example, cattle.
In a narrow sense, it can be argued that the currency ; This is a monetary system of one or another state. This concept is customary to consume both in other senses.
If we are talking about the reserve currency, we are talking about funds in which liquid state assets are contained.
For example, in the Russian Federation, US dollars and euros are used for this purpose.
It is also customary to talk about freely convertible currency. In this case, we are talking about the fact that cash in the form of such currencies are freely exchanged at the market rate.
Unlike them, there are both partially convertible and non-convertible currencies. In the first case, their exchange occurs under partial restrictions in certain types of exchange operations.
In the second case, we are talking about such a currency that is generally not used in international calculations, and has only domesticated in the country.
It is also accepted to share the currency of its country (in Russia it is ruble) and the one that has a walk in other countries (foreign currency).
If we talk briefly, then this concept includes:
- Cash funds;
- Cash of other countries;
- Precious stones and metals;
- Some types of securities.
Currency coding system
Of course, in real life, we can always easily determine what currency we are dealing with. Not so much about international economic activity.
An indication of which exactly the currency is used in the calculated calculations affects a lot. And therefore here any confusion is unacceptable. Of course, all the terms relating to this should be extremely defined.
For this purpose, a special international standard called ISO 4217.
In particular, it enters the eight most used ISO standards in the world. Work on him was launched back in 1970. And already in 1978 the standard was released and recommended for use.
It is interesting to notice, What kind of currency in it are taken into account:
- Existing currencies;
- Settlement currencies;
- Cashs of some funds;
- Settlement monetary units;
- Technical monetary units;
- Some historical currencies;
- Other currencies.
What belongs to the third item? As an example, you can bring American funds ; the same day ;.
We are talking about those who can provide the cash of the US FRC on the day of the application. That is, we are not talking about that currency, which is in circulation.
The fourth point includes various types of cash that exist practically ; on paper ; and apply to calculations inside some system.
Here, as an example, lead the currency of the SDR, which is used in the system of the International Monetary Fund for the estimated goals.
There may also be questions about the fifth category. As an example here, we give codes for non-cash transactions or testing codes.
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Principles of coding
In the ISO 4217 system, when encoding each currency, the following data is indicated:
- Name in English;
- Name in french;
- Three-letter code;
- Code of three digits;
- The state or territory where this currency refers;
- Data on how many decimal discharges at the currency.
The formation of the letter code occurs on the basis of a two-letter code of the country.
It is defined, in turn, ISO 3166-1. Of course, in the process of coding it is possible and difficult situations. For example, when a currency changes in the country or its denomination occurs.
There are also situations where cash is not attached at all to any state. By the way, gold also has its own code in the system under consideration.
As an example of how codes look like, we give them for the currency of the United States of America. Letter code ; This is usd.
The first two letters ; This is the country code, the last symbol indicates the American dollar.
Digital code is 840. It is noted that it is divided by one hundred parts (100 cents).
Listed a number of countries in which the US dollar is walking (their more than a dozen, we are not only about one country).
Currency coding in the Russian Federation
ISO 4217 does not apply directly in our country. On its basis in 1994, the All-Russian Currency Classifier was created.
Entered into force on July 1, 1995. At the moment it has the status of the State Standard. Codes used in this document (meaning the three-letter code and three-digit digital code) are taken from ISO 4217.
If you take a US currency designation for example, the same encoding is applied in this classifier as in ISO 4217.
As an alphabetic code, USD is used as a digital ; 840.
With the help of its creation, the following tasks were performed:
- Carrying out currency operations;
- Development of various foreign economic forecasts;
- Development of necessary reports on foreign trade operations;
- Control from the state over foreign exchange operations.
World currency exchange market
Currencies of all countries of the world
In some sense, one currency ; This is just product. Someone wants to sell him, and someone needs to buy it.
The subtlety here is that in this case the money simultaneously play the role and product and payment.
First of all, we note that it is usually not about a separate currency in the foreign exchange market, but about a pair. For example: EUR / USD. The currency that is in the first place is the base currency. On the second ; Cotrol.
Exchange rate ; This is the price of a base currency, expressed in units of quotation.
In most cases, we are talking about such a pair in which the dollar is present. If this is not, then the corresponding course is called cross-course.
Article prepared Christina Endless.
The author of the article, this blog. Traveling independently 8 years. Visited 32 countries. The author of video courses on the organization of profitable travel.