World Currency Unit
The WOCU (contraction of "world currency unit") is a standardized basket of currencies — the national currencies of the 20 largest national economies measured by GDP, established in 2008. The basket is reweighed semi-annually according to the relative growth of the economies, whereby constituent currencies are replaced by other currencies should the size of the GDP be overtaken by that of another national economy. Conceived as an apolitical and global alternative to the ECU, it is used as a reference currency for global investors and companies seeking to mitigate bilateral exchange rate volatility.
The World Currency Unit (WCU) is an indexed unit of account that stands for a unit of real global purchasing power.
Since each unit by design represents a stable unit of purchasing power, the stipulated interest rate on WCU-denominated bonds represents a real interest rate. In principle, the common denomination of bonds by issuers from different parts of the world using the WCU, as well as the greater transparency of real interest rates, will produce more efficient capital markets, as savers and borrowers around the world converge in their understanding of what each basis point of interest means and are protected against two key sources of uncertainty, namely inflation and exchange loss risks.
The WOCU’s advantage is that it is a natural currency stabilizer. The WOCU acts as an apolitical “Well-oiled shock absorber”, naturally smoothing out exchange rate volatility. The WOCU is applicable across a huge financial spectrum; trading of goods and services both on and offline, corporate treasury, asset and fund management, savings and bonds: from whole nations down to individuals.
The World Currency Unit (WCU) is an indexed unit of account that stands for a unit of real global purchasing power.
Since each unit by design represents a stable unit of purchasing power, the stipulated interest rate on WCU-denominated bonds represents a real interest rate. In principle, the common denomination of bonds by issuers from different parts of the world using the WCU, as well as the greater transparency of real interest rates, will produce more efficient capital markets, as savers and borrowers around the world converge in their understanding of what each basis point of interest means and are protected against two key sources of uncertainty, namely inflation and exchange loss risks.
The WOCU’s advantage is that it is a natural currency stabilizer. The WOCU acts as an apolitical “Well-oiled shock absorber”, naturally smoothing out exchange rate volatility. The WOCU is applicable across a huge financial spectrum; trading of goods and services both on and offline, corporate treasury, asset and fund management, savings and bonds: from whole nations down to individuals.
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