Why do central banks hold so many dollars, and what are they insuring against?
Central Banks as Dollar Lenders of Last Resort: Implications for Regulation and Reserve Holdings
Mitali Das et al. (2026) · IMF Working Paper
Replication data ↗ (openICPSR)
The archive requires an account we do not hold, so the files were not opened. What follows rests on the published abstract and on this platform's own observations.
What the authors found
Das, Gopinath, Hall, Kim and Stein document across 56 countries that central bank dollar reserve holdings correlate with how much the domestic corporate sector has borrowed in dollars, beyond the usual determinants of reserve accumulation. They then model the choice: a central bank facing private currency mismatch can either regulate borrowing in advance or stockpile reserves to act as a dollar lender of last resort afterwards, and the two are substitutes with different costs.
What our data adds
The exposure being insured against is partly visible from the trade side. The United States takes 13.7 per cent of world goods imports, while the dollar's share of invoicing and of corporate borrowing runs far higher — so firms across the world hold dollar liabilities without dollar revenues to match. That is the mismatch in the paper's first sentence, and it exists because the dollar's role in the financial system is out of proportion to America's role as a customer.
| Figure | Value | Indicator |
|---|---|---|
| US share of world goods imports | 13.7% | IMTS.MG_CIF_USD.A |
| Countries in the paper's reserve panel | 56 | IMTS.MG_CIF_USD.A |
Every figure here is computed from observations in this database and can be charted, downloaded or queried.
What this cannot show
This database has no reserves data, no corporate borrowing by currency, and no cross-border banking claims — the three series the paper is built on. The trade share is context for why the mismatch arises, not evidence about how central banks respond to it. IMF COFER for reserve composition and the BIS locational banking statistics are the sources that would be needed; the BIS is in this platform's register under a non-commercial licence that its terms do not clearly permit us to redistribute.