The Monetary Fund measures its debts using a basket of currencies that include the dollar, euro, pound, yen and renminbii. Photo by AFP
In April, debt to the International Monetary Fund rose to US $ 44,658 million from the equivalent of US $ 46,632 million. They are less than US $ 2,074 million. One part, US $ 709 million, was due to the repayment of a portion of the debt to the international financial organization and the other (US $ 1,365 million) in the fall from 1,382 to 1,344 of amount of Special Drawing Rights (SDR), a 2.7% reduction in total.
SDRs are the currency in which the IMF transacts: they include the dollar, euro, Chinese renminbi, Japanese yen, and British pound, and varies daily according to the oscillation of those currencies. During these months, measured in dollars, reduced the value of the SDR.
“It’s part of appreciation of the dollar relative to other currencies“he explained Lorenzo Sigaut Gravinadirector of Ecolatina
A year ago, the SDR was at $ 1,444. The year 2022 started at US $ 1.40. And, because of the global crisis, continued to lose value measured in dollars. From trading at 1,395 dollars at the end of February, it fell to 1,382 in March, dropped to 1,344 in April and on Wednesday, May 18, it traded at 1,338 dollars.
Since it was contracted with DEG, the debt to the IMF decreases in the same proportion as its value in the dollar decreases.
About $ 340 million in interest was paid to the IMF this month. But there is no scheduled payment of maturities to the IMF. And as the value of SDRs continues to decline, in dollars, the total SDR 33,221 million owed to the international organization in mid -May was equivalent to US $ 44,184 million, some US $ 500 million less than at the end of April.
On the other hand, some holdings in SDRs held by the Central Bank as part of its net reserves – now about 4.5 billion SDRs – also lost value in dollars.
In any case, future capital maturities at the IMF, taken into account in SDRs, will be canceled with new IMF disbursements. given in SDRs.
Meanwhile, the IMF changed how the SDR value will be evaluated starting Aug. 1.
“The composition of the SDR basket is reviewed every five years, or more frequently as necessary, to ensure it reflects the relative importance of each currency in global trade and financial systems”, Says the IMF Manual.
And it added: “In March 2021, the Executive Board delayed the next review of the SDR appreciation basket on July 31, 2022, thus restarting the five -year cycle of SDR appreciation evaluations. Since the next review will take place in mid -2022, the new basket will take effect on August 1st of 2022 ”.
This week, the IMF identified these new weights in the basket of currencies that make up the value of the SDR,
- *US dollar: rising from 41.73% to 43.38%
- Euro: down from 30.93 to 29.31%
- Chinese Renminbi: rose from 10.92 to 12.28%.
- Japanese yen: down from 8.33 to 7.59%
- British pound: down from 8.09 to 7.44%.
These changes, along with variations in currency prices, determine the evolution of debt in dollars with the IMF.
NE
Source: Clarin
