Economics
U.S. Defends Support for IMF Reserves After GOP Criticism
- Treasury would earn interest if U.S. buys other nations’ SDRs
- U.S. can refuse to buy reserves from any nation, Treasury says
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The Treasury Department released a detailed rebuttal of Republican criticism of support for an increase in International Monetary Fund reserve assets, saying that it will help support the global and U.S. economic recovery.
The proposed issue of $650 billion in the reserves, known as special drawing rights, or SDRs, will benefit low-income countries and impose no direct cost on the U.S., the Treasury said in a statement Thursday. Should the U.S. purchase SDRs from another country, the Treasury would earn interest that might offset any additional costs, and the U.S. can refuse to purchase reserves from any country whose policies it opposes, according to the statement.