A currency that is stable, has little fluctuation, making it ideal as the base for exchange rates of international transactions. Those who have high volatility do not bode well for international commerce or trading.
Because of the stability, a key currency sets the value for the other currencies.
Key currencies come from countries that are:
- strong
- developed
- globally active
- stable from an economic and political standpoint
It is easy to see how these are the currencies that are prominent. They will set the exchange rate for smaller countries.