The IMF as currency police?

Although no deal is struck between the financial leaders concerning currencies, the idea to expand the role of the International Monetary Fund (IMF) as a "currency police" has been raised. The United States came with the idea in exchange for the reforming of the IMF, where emerging powers like China and Brazil will gain a greater voice. According to the US, the IMF should get more information about the monetary policies of the biggest economies and more power to adjust these policies, pointing to China’s Yuan. In which ways the IMF should expand its role remains unclear, even though Strauss-Khan, IMF’s managing director, suggested the IMF could follow the 5 largest economies (the United States, China, Japan, the euro zone and the UK) and measure the influence of their monetary policies.

Pieter-Jan Deprest

http://www.reuters.com/article/idUSTRE6952N820101010