RisingShiningSuperpower
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This is a shocking development. India cannot afford to fall behind China on this front. Modi-ji must lobby for the Rupee to be included in the elite club of IMF global reserve currencies. I am confident that under Modi-ji's brilliant leadership, Rupee will become the number global reserve currency by 2020!
Yuan becomes IMF reserve currency | Business | DW.COM | 30.11.2015
Yuan becomes IMF reserve currency
Officially it's called the renminbi, commonly the yuan . Or to be more precise - renminbi is the currency, yuan is the basic unit of the currency, similar to the terms used for the UK currency, sterling and pound. After Monday, China's currency can be called one of the most important in the world.
The International Monetary Fund (IMF) on Monday voted to include the yuan in its basket of world currencies, a longstanding goal of Beijing's as it seeks to elevate the position of its own legal tender against the US dollar, euro, sterling and yen. The change will take effect next October.
China's economy, second to only the United States in terms of its size, has long enjoyed elite status, but Chinese money has had no such luck.
Until recently, the International Monetary Fund (IMF) considered the yuan too tightly controlled by Beijing to treat it the same as other major currencies.
A mark of honor
The soon-to-be five currencies belong to the IMF's so-called "special drawing rights" (SDR), the average value of which the crisis lender uses as a benchmark for some of its most important calculations.
To that end, the SDR is an artificial currency of sorts, although it has no physical representation. It is a tool used by the IMF, and it can be exchanged for "real" currencies.
When the IMF issues emergency loans to economies in need, for instance, as was recently the case in Greece, it does so in SDRs.
It also sets limits on how much of a particular reserve currency each of its 188 member states can call on based on the daily average of the market exchange rates of the currencies.
Growing popularity
In order to be included in the IMF's prestigious basket, China had to show that the yuan was widely used for international transactions and trades on foreign exchange markets. In fact, it is now the third most-traded currency in the world.
This is a result of Beijing's policy to persuade other countries to do business in yuan, something it achieved by forging currency swap deals with nearly 40 other countries and pursuing various trade deals across Asia.
Yuan-denominated financial instruments are also gaining in popularity among international investors. A recent example of the currency's growing stature came this November when a new German-Chinese financial market was opened in Frankfurt. On offer were 200 products, all available in yuan.
cjc/ng (dpa, AFP, Reuters)
Yuan becomes IMF reserve currency | Business | DW.COM | 30.11.2015
Yuan becomes IMF reserve currency
Officially it's called the renminbi, commonly the yuan . Or to be more precise - renminbi is the currency, yuan is the basic unit of the currency, similar to the terms used for the UK currency, sterling and pound. After Monday, China's currency can be called one of the most important in the world.
The International Monetary Fund (IMF) on Monday voted to include the yuan in its basket of world currencies, a longstanding goal of Beijing's as it seeks to elevate the position of its own legal tender against the US dollar, euro, sterling and yen. The change will take effect next October.
China's economy, second to only the United States in terms of its size, has long enjoyed elite status, but Chinese money has had no such luck.
Until recently, the International Monetary Fund (IMF) considered the yuan too tightly controlled by Beijing to treat it the same as other major currencies.
A mark of honor
The soon-to-be five currencies belong to the IMF's so-called "special drawing rights" (SDR), the average value of which the crisis lender uses as a benchmark for some of its most important calculations.
To that end, the SDR is an artificial currency of sorts, although it has no physical representation. It is a tool used by the IMF, and it can be exchanged for "real" currencies.
When the IMF issues emergency loans to economies in need, for instance, as was recently the case in Greece, it does so in SDRs.
It also sets limits on how much of a particular reserve currency each of its 188 member states can call on based on the daily average of the market exchange rates of the currencies.
Growing popularity
In order to be included in the IMF's prestigious basket, China had to show that the yuan was widely used for international transactions and trades on foreign exchange markets. In fact, it is now the third most-traded currency in the world.
This is a result of Beijing's policy to persuade other countries to do business in yuan, something it achieved by forging currency swap deals with nearly 40 other countries and pursuing various trade deals across Asia.
Yuan-denominated financial instruments are also gaining in popularity among international investors. A recent example of the currency's growing stature came this November when a new German-Chinese financial market was opened in Frankfurt. On offer were 200 products, all available in yuan.
cjc/ng (dpa, AFP, Reuters)
