Brazil To Buy Up To $10 Billion In IMF Notes-01.22.10
source: http://dowjones.com
SAO PAULO (Dow Jones)--The Brazilian government and the International Monetary Fund on Friday signed a technical agreement under which Brazil will buy up to $10 billion in IMF notes over the next two years.
Brazil's government last year expressed its intention to participate in an IMF program to raise funds from certain members nations as a way to expand lending operations to needy countries hurt by the global credit crisis. The purchases will represent the first time for Brazil to become an IMF creditor. In past years, Brazil often borrowed money from the IMF.
The IMF notes will be denominated in IMF Special Drawing Rights, which represent a basket of currencies. They will pay interest quarterly.
In a joint statement, the Brazilian Finance Ministry and the Brazilian Central Bank noted that the purchase of the IMF notes will not substantially alter Brazil's foreign reserve position, "it will merely alter its composition." The statement said the Brazilian government will pay for the notes with money from existing reserves. The notes themselves will then be re-incorporated into reserves.
Brazilian foreign reserves currently stand at about $240 billion.
-By Tom Murphy, Dow Jones Newswires; 55-11-2847-4519; brazil@dowjones.com
http://online.wsj.com/article/BT-CO-20100122-712569.html?mod=WSJ_latestheadlines
Brazil's government last year expressed its intention to participate in an IMF program to raise funds from certain members nations as a way to expand lending operations to needy countries hurt by the global credit crisis. The purchases will represent the first time for Brazil to become an IMF creditor. In past years, Brazil often borrowed money from the IMF.
The IMF notes will be denominated in IMF Special Drawing Rights, which represent a basket of currencies. They will pay interest quarterly.
In a joint statement, the Brazilian Finance Ministry and the Brazilian Central Bank noted that the purchase of the IMF notes will not substantially alter Brazil's foreign reserve position, "it will merely alter its composition." The statement said the Brazilian government will pay for the notes with money from existing reserves. The notes themselves will then be re-incorporated into reserves.
Brazilian foreign reserves currently stand at about $240 billion.
-By Tom Murphy, Dow Jones Newswires; 55-11-2847-4519; brazil@dowjones.com
http://online.wsj.com/article/BT-CO-20100122-712569.html?mod=WSJ_latestheadlines
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- groups:
- IMF Watch
