Special Drawing Rights

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Special Drawing Rights

(SDRs), type of international monetary reserve currency established (1968) by the International Monetary FundInternational Monetary Fund
(IMF), specialized agency of the United Nations, established in 1945. It was planned at the Bretton Woods Conference (1944), and its headquarters are in Washington, D.C.
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 (IMF). Created in response to worries concerning the limitations of gold and dollars as the sole means of settling international accounts, SDRs are designed to augment international liquidity by supplementing the standard reserve currencies. SDRs are assigned to the accounts of IMF members in proportion to their contributions to the fund. Each participating country agrees to accept them as exchangeable for reserve currencies in the settlement of international accounts. Deficit countries can use them to purchase stronger currencies, which then can be used to pay off balance-of-payments debts. As nations adopted the current system of floating exchange rates (1973), the value of SDRs began to be set relative to a "basket" of major currencies. In 1976 the IMF increased the share of the less-developed countries and moved to make SDRs the primary reserve asset of the international monetary systeminternational monetary system,
rules and procedures by which different national currencies are exchanged for each other in world trade. Such a system is necessary to define a common standard of value for the world's currencies.
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, supplanting gold and dollars. In 1981 the IMF reduced the basket to five currencies (the U.S. dollar, German Deutschmark, Japanese yen, French franc, and British pound). In 1999 the Deutschmark and franc were replaced by their equivalents in the euro, and in 2016 the Chinese yuan was added to the basket. All IMF accounting is done in SDRs, and commercial banks accept SDR-denominated accounts. The IMF has the exclusive right of allocating SDRs; the last such allocation was made in 2009.
References in periodicals archive ?
Another option to lessen dependence on the dollar would be greater use of special drawing rights (SDR), considered more stable.
The SDR allocation will be made to IMF members that are participants in the Special Drawing Rights Department (currently all members) in proportion to their existing quotas in the fund, which are based broadly on their relative size in the global economy.
The SDR allocation will be made to IMF members that are participants in the Special Drawing Rights Department in proportion to their existing quotas in the fund, which are based broadly on their relative size in the global economy.
But he does not make a convincing case for the richer nations accepting his own proposal for Special Drawing Rights.
dollars for CIBER, or Special Drawing Rights (SDRs) for TAP.
3 billion since the last adjustment in June, while special drawing rights fell slightly from $1.
The reserves are made up of securities and deposits denominated in foreign currencies and gold, as well as reserve positions and special drawing rights Japan holds at the International Monetary Fund.
Summary: BERLIN - Chancellor Angela Merkel has ruled out using gold and currency reserves or IMF special drawing rights, or SDRs, to boost the eurozone bailout fund for fear of violating the independence of Germany's central bank, which opposes such use of reserves.
The central bank has offered special drawing rights (SDR) relief for commercial banks, urging them to reduce interest rates to clients.
of Belgium has been authorised to acquire certain power plants and drawing rights on certain electricity generation capacity in Germany from E.
There will also be a new credit package worth $250 billion to improve trade flows and $250 billion in special drawing rights for countries.