Yuan el­e­vated to elite club of cur­ren­cies

China Daily (Canada) - - NEWS CAPSULE -

The IMF ap­proved the yuan as the fifth elite cur­rency to join the spe­cial draw­ing rights bas­ket (SDR), which is a for­eign ex­change re­serve as­set that in­cludes the US dol­lar, euro, yen and the Bri­tish pound.

“The RMB’s ac­qui­si­tion of SDR sta­tus marks a mile­stone, which is equiv­a­lent to that of China's en­try into the World Trade Or­ga­ni­za­tion in 2001,” said He Zhicheng, for­mer se­nior economist with the Agri­cul­tural Bank of China.

Ris­ing de­mand for yuan as­sets brought by in­clu­sion in the SDR bas­ket will push China to deepen re­form and the in­ter­na­tion­al­iza­tion of yuan, at a time when China is be­com­ing more in­te­grated into the global mar­ket, ac­cord­ing to Zhao Xue­qing, an economist with the In­sti­tute of In­ter­na­tional Fi­nance, a think tank af­fil­i­ated with the Bank of China.

The ren­minbi has leapfrogged other cur­ren­cies to oc­cupy the third-largest share of the new SDR bas­ket at 10.92 per­cent, fol­low­ing the US dol­lar's 41.73 per­cent and the euro’s 30.93 per­cent.

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