Biden Sanctions on Russian Debt Called a âFirst Salvoâ That Send a Message
The curbs on U.S. banksâ purchases of some bonds apply to a small portion of the market but could signal a sharper aim at Russiaâs access to global capital.
The United States was able to sever Iran from the global financial system, in part because the American dollar is the worldâs reserve currency. Isolating Russia would be more difficult.Credit...Stefani Reynolds for The New York Times
April 15, 2021, 4:28 p.m. ET
The Biden administration on Thursday barred American banks from purchasing newly issued Russian government debt, signaling the deployment of a key weapon in Washingtonâs intensifying conflict with Moscow â threatening Russiaâs access to international finance.
Summary
The IMF was created in the wake of World War II to manage the global regime of exchange rates and international payments.
Since the collapse of fixed exchange rates in 1973, the fund has taken a more active role, intervening in debt crises in developing countries and in Greece and responding to the pandemic-induced economic crisis.
Some critics say the conditions the IMF attaches to its loans are too harsh and have harmed developing countries.
Since its inception in July 1944, the International Monetary Fund (IMF) has undergone considerable change as chief steward of the world’s monetary system. Officially charged with managing the global regime of exchange rates and international payments that allows nations to do business with one another, the fund recast itself in a broader, more active role following the 1973 collapse of fixed exchange rates, intervening in developing countries from Asia to Latin America. In 2010, it gained renewed relevance as the European sovereign debt crisis unfolded, and, a decade later, it responded to the economic collapse triggered by the coronavirus pandemic.