Chinese Renminbi to join IMF official reserves from October

8 Mar 16

The Chinese Renminbi is to be identified in the International Monetary Fund’s official foreign reserves database as of October, the fund has announced.

The listing will enable IMF members to identify Renminbi-denominated external assets that are readily available for meeting balance of payments financing needs as official reserves, and further advance China’s goal of securing a bigger international role for its currency.

The IMF said the change will be reflected in a survey for the fourth quarter of 2016, known as COFER (Currency Composition of Official Foreign Exchange Reserves), which will be published at the end of March 2017.

COFER lists the currency composition of holdings in foreign exchange reserves across the IMF’s membership in the form of statistical aggregates. The Renminbi will join the US dollar, Euro, Yen, UK Pound, Swiss Franc, Australian dollar and Canadian dollar, which are already identified in the survey.

In September, China reported data on its official reserves for the first time to the IMF with the intentions of speeding up the inclusion of the Renminbi in the fund’s basket of reserve currencies.

The IMF announced in December it would include the Renminbi in the currency basket that determines the value of the body’s Special Drawing Rights reserve asset.

IMF managing director Christine Lagarde hailed the move as an “important milestone” that recognised the integration of the Chinese economy into the global financial system and recognised the country’s progress in reforming monetary and financial systems.

The Special Drawing Right is an international reserve asset, created by the IMF, to supplement its member countries’ official reserves. 

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