The US dollar remained the principal global reserve currency during the second quarter of 2026, according to IMF data adjusted for currency changes. Preliminary figures indicated the dollar’s share of central bank reserves declined to 56.32% at the end of June from 57.79% in March. However, the greater part of that decline was due to exchange rate movements rather than to shifts by central banks among currencies.
The COFER dataset published by the IMF shows in which currencies 149 countries hold their foreign reserves. In US dollar terms, changes in the value of currencies can distort the appearance of movements that have not actually taken place.
This year, the US dollar has significantly weakened: the DXY index, a basket of currencies against the euro, yen, pound, and franc, fell more than 10% in the first half of the year, the biggest drop since 1973.
Currency Movements Drive Apparent Shifts
In only the second quarter, the dollar lost 7.9% against the euro and roughly 9.6% against the Swiss franc. This, in turn, elevated the dollar value of non-dollar assets and reduced the dollar’s share of global reserves. Without the effect of changed exchange rates, the dollar’s share would have declined only marginally, to 57.67%, indicating that 92% of the apparent drop resulted from valuation changes.
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Similarly, the share of the euro increased from 20.00% to 21.13%. But most of this gain came from the euro getting stronger against the dollar, not from central banks buying more euros. If currency values didn’t change, the euro’s share would have only fallen slightly to 19.96%. The pound did the same thing: what looked like a gain was mainly an illusion caused by exchange-rate effects.
Understanding Reserve Data in a Volatile Market
Other major reserve currencies, such as the euro and the British pound, appeared to gain some share in the second quarter. The euro’s share increased to 21.13% from 20.00%, while that of the pound also appeared to rise. These gains were due mostly to changes in the value of the currencies.
Using the same exchange rates as in the first quarter, the euro’s share would have declined slightly, while that of the pound would have fallen. This illustrates why we need to adjust global reserve data for exchange rates. Without such adjustments, apparent shifts can mislead people about how central banks act.
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