From the AFR:
The IMF is considering classifying the $A, and also the Canadian dollar, as reserve currencies, alongside US dollars, euros, British pounds, Japanese yen and Swiss francs.
The move was flagged in the IMF’s recent Composition of Foreign Exchange Reserves (CoFER), which for the first time included line items for those two currencies, rather than including them in the ‘other’ category.
…The move will mean that reserve holding nations will be asked to provide details of the Australian and Canadian dollar holdings. This should give policymakers a clearer picture of the extent to which international central banks hold the domestic currency.
“It also means that from next year we will be given more precise information about just how much of global FX reserves are held in AUD and CAD,” Westpac rates strategist Russell Jones. “The broad consensus today is that some $60bn of each is currently held by central banks. We will soon find out how accurate these estimates are.”
More information would be good. But otherwise this is terrifying and the last thing the economy needs.
