kasinkei

An SDR is purely a reserve currency, not an actively traded/used currency in the markets. As other people have explained its an artificial currency made up of USD, Yen, Sterling, and Euros weighted on their respective importance in the global economy. I say its a reserve currency because its sole purpose is to sit on the balance sheet of the country's foreign reserves. These are used for intervention purposes mainly. The main idea is that countries can exchange their SDRs for a 'hard' currency if they needed to intervene on the FX market to aid in liquidity.

Ex. Egypt's markets and businesses are finding it hard to conduct business because of lack of credit available to them in USD. Well the IMF allocated Egypt an amount of SDRs, so they would sell these SDRs to another country to obtain USD which they could then inject into their economy.