Review Of The Fund’s Policy On Multiple Currency Practices: Initial Considerations
June 10, 2019
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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.
Subject: Currencies, Exchange rates, Exchange restrictions, Foreign exchange, Money, Multiple currency practices
Keywords: article, Central Africa, Currencies, East Africa, Exchange rates, exchange restriction, Exchange restrictions, exchange transaction, fund member, Global, IMF's transparency policy, market, MCP Policy, Middle East, Multiple currency practices, PP, The Fund, transaction, transaction vis-à-vis
Pages:
130
Volume:
2019
DOI:
Issue:
015
Series:
Policy Paper No. 2019/015
Stock No:
PPEA2019015
ISBN:
9781498318860
ISSN:
2663-3493
