XPost: misc.invest.canada, soc.culture.canada, can.atlantic.general 
 XPost: can.general, can.politics 
 From: abc@a123.ca 
  
 IMF considering loonie as reserve currency 
  
 Anchalee Worrachate and John Detrixhe, Nov 19, 2012 
  
 The Canadian dollar, nicknamed the loonie for the image of aquatic bird 
 on the $1 coin, has gained 2.5% against the greenback this year. 
  
 The International Monetary Fund said it€s considering classifying the 
 Australian and the Canadian dollars as reserve currencies. 
  
 The two €are to be considered for inclusion€ separately in the IMF€s 
 €Currency Composition of Official Foreign-Exchange Reserves€ data, the 
 Washington-based lender said in a report published on Nov. 14. They€ve 
 previously been included in an €other currencies€ category in the COFER 
 reports. 
  
 The Australian and Canadian economies have been much more stable than the 
 top economies in the post-financial-crisis era 
 The IMF plan comes as Australia and Canada have shown more signs of 
 stability in the fallout of the 2008 financial crisis than the world€s 
 biggest developed economies. While the U.S., to the U.K. to Japan have 
 been coping with increasing debt loads, deficits in Canada and Australia 
 are forecast to be below 5% of gross domestic product in 2012 and are 
 expected to shrink. 
  
 €It really helps to cement the stability of these currencies,€ Ravi 
 Bharadwaj, a market analyst in Washington at Western Union Business 
 Solutions, a unit of Western Union Co., said in a telephone interview. 
 €The Australian and Canadian economies have been much more stable than 
 the top economies in the post-financial-crisis era.€ 
  
 The Australian budget is forecast to show a surplus that is 0.1% relative 
 to GDP next year, after a 3% deficit in 2012, according to the median 
 estimate of economists surveyed by Bloomberg. Canada€s may shrink to a 
 0.6% deficit from 1.2%. The U.S. shortfall relative to GDP is forecast to 
 contract to 5.7% from 7%. 
  
 Risk Appetite 
  
 €The Canadian and Australian dollars have been appreciating today, and 
 that€s partly to do with the better- than-expected appetite for risk that 
 we€re seeing across all sectors of financial markets,€ Bharadwaj said. 
 €The Aussie€s gain seems particularly strong and also based on the IMF 
 decision to raise it to reserve status.€ 
  
 The Aussie climbed 0.6% to US$1.0404 as 12:39 p.m. in New York after 
 gaining as much as 0.8%, the most since Nov. 6. The Canadian currency 
 advanced 0.5% to 99.65 cents per U.S. dollar. 
  
 The Canadian dollar, nicknamed the loonie for the image of aquatic bird 
 on the $1 coin, has gained 2.5% against the greenback this year, while 
 the Aussie has rallied 2%. Australian government bonds have returned 5.9% 
 in 2012, compared with 2.6% for Canada€s debt and 2.8% for Treasuries, 
 according Bank of America Merrill Lynch indexes. 
  
 €Others€ Rise 
  
 €Elevating the Aussie and loonie to reserve status certainly helps to 
 ascertain how global central banks are diversifying their currency 
 holdings,€ Bharadwaj said. 
  
 The share of global foreign-exchange reserves denominated in so-called 
 other currencies rose to 5.3% in the second quarter, from 2% in 2007, 
 according to IMF data published in September. The percentage of reserves 
 denominated in U.S. dollars was 61.9% in the second quarter. 
  
 The IMF also counts the euro, the yen, the British pound and the Swiss 
 franc as reserve currencies with separate data points in the COFER 
 reports. 
  
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