I understand the United States’ role in the global economy, with the Intranet origin being a US Govt. project. But still, why is this the standard? Is it just culture being the answer?
(100% willing to accept DMs that are not ELI5ed)
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The US has been the biggest and strongest economy after WW2. The US funded a lot of recovery efforts in Europe and Japan (and elsewhere). Since it was the most stable and highly traded with economy, it is easy to understand why the USD price became the reference price for many international trade.
Imagine if you sold your goods internationally and many of the customers are from the US. If someone from another country wanted to purchase your goods, you’d use the price charged to the US customers as a reference. Gradually this became true for all major traded commodities.
Post WW2, the US banking system and currency became the center of financial transactions and currency exchanges (since it was funding the recovery). This meant that many countries pegged or referred to the price of their currency against the USD. So if someone with Japanese Yen wanted to buy German Marks, in a sense, they would convert the Yen to USD then the USD to German Marks. This is still the case with many smaller currencies.
Because of all this, it has become a somewhat standard practice that when comparing values across countries and regions, it is usual to normalize it to the USD. Otherwise the comparisons are more difficult and the statistics become less easy to interpret. Within a local region or country, though the official statistics are almost always quoted in terms of the local currency and a USD equivalent might be provided as a courtesy.
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