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Review Of The Fund’s Policy On Multiple Currency Practices: Initial Considerations
Author:
International Monetary Fund. Legal Dept.
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International Monetary Fund. Monetary and Capital Markets Department
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International Monetary Fund. Strategy, Policy, &amp
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Review Department
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International Monetary Fund. Research Dept.
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Series:
Policy Papers
Volume/Issue:
Volume 2019: Issue 015
Language:
English
Publication Date:
10 Jun 2019
DOI:
https://doi.org/10.5089/9781498318860.007
ISBN:
9781498318860
ISSN:
2663-3493
Pages:
130
Keywords:
PP; article; The Fund; MCP Policy; market; transaction; exchange transaction; exchange restriction; fund member; transaction vis-à-vis; Multiple currency practices; Exchange rates; Exchange restrictions; Currencies; Global; IMF's transparency policy; Middle East; Central Africa; East Africa
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This paper reviews the Fund’s policy on multiple currency practices (MCPs). There remain strong economic and legal reasons to retain a policy on MCPs. The over-arching aim of the review is to make the policy and its application more effective. Based on this review, the paper proposes initial considerations for reforming features of the policy that have created challenges. • Clarifying the concept of “official action” to focus on measures that segment FX markets. • Eliminating potentiality. • Updating the threshold for permissible FX spreads. • Adjusting approval policies. • Reviewing links with capital transactions. • Considering merits of a remedial framework.
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Cover Policy Papers
Policy Papers
ISSN:
2663-3493
Publisher:
International Monetary Fund