Last Updated : 14 May 2012 at 17:05 IST
IMF stresses need to increase reserves due to rising credit risk
The International Monetary Fund (IMF) is planning to increase its precautionary reserves on account of rising global risks, the organization's latest report says.
By Col. Ajay
As per financial astrology, transit OD Sun in Saturn house is ..
*** This is an updated and corrected version. The IMF has NOT stated that it plans to buy $2.3 billion of gold as reserves. INSTEAD, the IMF has only stated that it plans to increase its reserves
NEW YORK (Commodity Online): The International Monetary Fund (IMF) is planning to increase its precautionary reserves on account of rising global risks, the organization's latest report says.
“The Fund is facing increased credit risk in light of a surge in program lending in the context of the global crisis. While the Fund has a multi-layered framework for managing credit risks, including the strength of its lending policies and its preferred creditor status, there is a need to increase the Fund’s reserves in order to help mitigate the elevated credit risks”, the IMF report states
“Directors supported an increase in the medium-term indicative target for precautionary balances to SDR 20 billion in light of the increase in total Fund credit and commitments since the last review in 2010”, the report adds
IMF's borrowers include Eurozone countries like Greece and Portugal. Greece is IMF's biggest borrower and the nation is currently caught in a political deadlock that seems bent on denying itself the much needed bailout fund.
Countries like Spain is also officially in recession after its first quarter GDP contracted. Other nations in the Eurozone region is also showing increased signs of slow manufacturing activity and economic growth.
- Copper witnessing a shift to permanently slower demand growth: Barclays
- MCX Lead bearish, Nickel negative; support 121.6 and 824
- MCX Crude Oil bullish; resistance 5830 and 5900
- MCX Silver sideways; support 43500, resistance 44200
- MCX Gold sideways to bullish; resistance 28150
- MCX Natural Gas positive; resistances 232.5 and 235