SDR
- INTERNATIONAL
News:
COP28: Japan, France back
plan to boost climate lending with SDRs
What's
in the news?
●
Japan and France said they will support
the African Development Bank (AfDB) and Inter-American Development Bank's (IDB)
plan to leverage IMF Special Drawing Rights for climate and development.
SDR:
●
Special
Drawing Rights (SDRs) is the IMF’s unit of account and not a currency.
SDR
Basket:
●
SDR
basket of currencies includes the U.S. dollar, Euro, Japanese yen, pound
sterling and the Chinese renminbi (included in 2016).
●
The currency value of the SDR is
determined by summing the values in U.S. dollars, based on market exchange
rates, of a SDR basket of currencies.
SDR
Valuation:
●
The SDR currency value is calculated daily
(except on IMF holidays or whenever the IMF is closed for business) and the
valuation basket is reviewed and adjusted every five years.
Importance
of SDR:
●
Quotas
are denominated (expressed) in SDRs.
●
SDRs represent a claim to currency held by
IMF member countries for which they may be exchanged.