Evolution and development trends of the world monetary and fi nancial system

Abstract

Introduction. Structural changes in the world economy and trade and its financialization contributed to the growth of instability and necessitated the building a new structure for the world monetary and financial system. Theoretical analysis. The evolution of the global monetary and financial system, when the function of world money shifted from gold to fiduciaries and SDR, resulted in the formation of a two-level structure. The top level consists of countries with reserve currencies and, thanks to this, such countries have the privilege of forming long and cheap liabilities by creating public and corporate debt, financing the balance of payments deficit through monetary issuance. The rest of the countries that do not have significant sources of long-term investments belong to the lower level, since they are obliged to maintain the compliance of their national monetary base with the volume of international reserves. The development of the global monetary and financial system within the framework of such structure was supported by an increase in the volume of financial transactions and the appearance of derivatives, the purpose of which was not only hedging, but also speculation. Empirical analysis. It was found out that, while the chronic deficit of the trade and balance of payments and growing volume of public debt were not a problem for the United States for the last 20 years, a sharp increase of Federal Reserve System rates in 2022, that resulted in increased nominal yield of the treasuries, significantly increased the cost of debt servicing. The decrease in the degree of confidence in the dollar pushes central banks to diversify international reserves, as a result the share of gold in the structure of these reserves has begun to increase. Those countries that do not have reserve currencies are now more interested in CBDCs. Results. The increasing importance of tangible assets against the background of political and financial instability in the world, as well as the need to use modern digital forms of money, open up the possibility for the ruble to become one of the world’s reserve currencies in the new structure of the multipolar world monetary and financial system.

Keywords

• fiduciary currencies
• dollar globalization
• reserve currencies
• international reserves
• monetary gold role increase
• debt crisis risk
• digital currency
• dual-circuit financial system
• financial independence
• conditions for ruble security