Gold reserve is the gold held by a country's monetary authorities to balance international payments, maintain exchange rate stability or serve as an international reserve. Although gold is no longer a currency, countries still maintain certain reserves as the last international payment means.
Currency reserves are foreign exchange deposits held by a country's monetary authorities and creditor's rights held in foreign exchange. They are mainly used to balance the balance of payments and intervene in the foreign exchange market to maintain the stability of the exchange rate. For example, the People's Bank of China holds a large amount of foreign exchange reserves such as US dollars and euros to cope with the possible international payment crisis.
Special Drawing Rights (SDR) is the right to use funds allocated by the International Monetary Fund to member countries, which can be used to exchange foreign exchange from other member countries when the balance of payments is in deficit, pay the balance of payments deficit or repay IMF loans, and can also be used as international reserves.
The reserve position in the International Monetary Fund is the share of member countries in the special drawing rights account, and it is a part of the funds paid by member countries to the fund.
The above are the main components of foreign exchange reserves, and each part plays an important role in the international financial system, helping countries to cope with possible economic risks.