Criteria for inclusion of a currency in IMF basket
Q. Which of the following is/are criteria for inclusion of a currency in IMF basket?
1. A country’s exports of goods and services must be among the largest in the world.
2. Currency should be “widely used” and “widely traded”.- Published on 03 Dec 15a. Only 1
b. Only 2
c. Both
d. None
ANSWER: Both
- Currencies usability depends upon reserve holdings, international banking liabilities, international debt securities and foreign-exchange turnover.
- Chinese yuan was added in IMF basket beside dollar, euro, pound and yen.
- Yuan is widely exchanged in Asia, it accounts for a "small but growing share" of trading in Europe and only "thin" volumes in North America.
