Tuesday, May 1, 2018

IMF - Spring Meeting Communique

The IMF recently completed their annual spring meeting. There was not much activity in terms of anything that would lead to major monetary system reform as far as I can tell. Below is a portion of the concluding section of the report. You can read the full report here.


IMF resources and governance
"We reaffirm our commitment to a strong, quota-based, and adequately resourced IMF to preserve its role at the center of the GFSN. We are committed to concluding the 15th General Review of Quotas and agreeing on a new quota formula as a basis for a realignment of quota shares to result in increased shares for dynamic economies in line with their relative positions in the world economy and hence likely in the share of emerging market and developing countries as a whole, while protecting the voice and representation of the poorest members. We call on the Executive Board to work expeditiously toward the completion of the 15th General Review of Quotas in line with the above goals by the Spring Meetings of 2019 and no later than the Annual Meetings of 2019. We note the progress report to the Board of Governors and look forward to further progress by the time of our next meeting. We welcome the progress made in securing commitments under the 2016 Bilateral Borrowing Agreements. We call for full implementation of the 2010 governance reforms."
My added comments: The IMF has continued to issue warnings regarding total global debt and the risk it poses to global financial stability. They mention it again in this report. Earlier we covered the new IMF report on an expanded role for the SDR.
While no immediate threats to global financial stability are mentioned, we all understand that the very high debt to GDP ratios that exist around the world (including in the US) remain an ongoing risk for financial stability. 

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