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Special Drawing Rights

Chris Farrell Aug 28, 2009

Question: Can an individual buy IMF SDR’S? If so, how? Thank you for considering my question. Willy, Medford, WI

Answer: Well, this is the first time I’ve ever gotten a question about buying the International Monetary Fund’s Special Drawing Rights. That’s why I couldn’t resist answering it even though it lies on the financial fringe. The quick answer is no.

The SDR is a kind of currency unique to the IMF and its international dealings. The SDR was created in 1969, and its value is currently fixed according to a weighted basket of four currencies, the U.S. Dollar, the Euro, the Yen, and the British Pound. SDRs briefly moved out of international accounting obscurity into the global limelight last spring when the G20 ministers announced a dramatic increase in the amount of SDRs. The idea was to get the IMF to use SDRs as one more financial tool to combat the global downturn. There was also some discussion among international economics about turning the SDR into a global currency. It would supplant the dollar. Since then, however, the SDR has faded back into shadows of IMF accounting.

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