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Economics vocabulary · Trade and Exchange Rates

Dollarisation

Meaning in economics, with examples

nounAdvanced term

In economics, dollarisation means: The use of the US dollar or another foreign currency instead of, or alongside, the national currency for saving, pricing or borrowing.

In Turkish: dolarizasyon, dövizleşme

How it is used

Full or official dollarisation means a country adopts the dollar as its currency, as Ecuador and Panama have done. Partial dollarisation is common where high inflation has made people keep savings in foreign currency. Reversing it is called de-dollarisation. US spelling: dollarization.

Example sentences

  1. Years of high inflation led to widespread dollarisation of household savings.

  2. Reducing dollarisation is one of the central bank's priorities.

Common collocations

  • deposit dollarisation
  • de-dollarisation
  • full dollarisation
  • partial dollarisation
  • currencyThe system of money used in a country, such as the lira, the euro or the dollar; foreign currency means money from other countries.
  • hyperinflationExtremely rapid inflation, often defined as prices rising by more than 50% a month, which quickly destroys the value of a currency.
  • exchange rateThe price of one currency expressed in another, for example how many Turkish lira you need to buy one US dollar or one euro.
  • foreign exchange reservesAssets in foreign currencies, such as dollars and euros, held by a central bank to pay for imports, repay foreign debt or support the national currency.

More terms: Trade and Exchange Rates

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This page explains English vocabulary for learners. It is not financial advice.