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IMF to review Chinese currency's SDR qualification.

TOKYO, Aug 5 (KUNA) -- The executive board of the International Monetary Fund (IMF) still plans to formally review the possibility of adding the Chinese currency yuan (renminbi) to its benchmark currency basket by the end of this year, state-run Xinhua News Agency reported, citing senior IMF officials. The officials made the remarks to Xinhua after some Western media reported Tuesday that the IMF may delay the inclusion of the Chinese yuan in its special drawing rights (SDR) basket till September 2016. The international use of the yuan" has increased substantially" since the last review of the SDR basket in 2010, the IMF said in a staff report released Tuesday. "Other currencies have not experienced substantial changes in their relative prominence, underscoring that the rise of the yuan is the most significant development in international currency use since the last review," the IMF said in the report that laid out the initial considerations for reviewing the yuan's inclusion in the SDR basket scheduled later this year. "This notion is also supported by other contextual information such as the rising global network of yuan swap lines and the rapid growth in yuan payments from offshore clearing centers to the Mainland," the IMF report said. It also said the international use of the yuan is vital for the IMF to decide whether the yuan is a "freely usable" currency, an important criterion for admission into the SDR. The IMF report didn't give any indications whether the yuan would be put in the SDR basket later this year, but recommended extending the current SDR basket mandate by nine months until September 2016. The IMF's executive board will formally discuss the yuan's SDR review toward the end of the year, the official confirmed. The IMF reviews the currencies in the SDR basket every five years, and whether to add the yuan to the basket is a major issue for this year's assessment. The SDR basket was created in the 1960s as an international reserve asset that IMF members can claim in times of need. It currently contains only four currencies, namely the US dollar, the euro, the British pound and the Japanese yen. (end) mk.ibi

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Publication:Kuwait News Agency (KUNA)
Date:Aug 5, 2015
Words:375
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