Special Drawing Rights

Special Drawing Rights (SDRs) are international financial assets created by the International Monetary Fund (IMF) to support countries’ economies. Think of SDRs as a global reserve currency that countries can use to access foreign exchange or settle international accounts. The value of SDRs is based on a basket of major currencies, such as the dollar, euro, yen, and pound. They are not physical cash but a designation that helps countries manage their currency needs and promote financial stability by providing additional liquidity in times of economic strain.