IMF lifts weighting of dollar, Chinese yuan in SDR basket
BEIJING, May 15 (Reuters) - The International Monetary Fund said on Saturday it has increased the weighting of the dollar and Chinese yuan in its review of the currencies that make up the valuation of its Special Drawing Rights (SDR), an international reserve asset.
The review is the first since the yuan, also known as the renminbi, joined the basket of currencies in 2016 in what was a milestone in Beijing's efforts to internationalise its currency.
The IMF raised the U.S. currency's weighting to 43.38% from 41.73% and the yuan to 12.28% from 10.92%. The euro's weighting declined to 29.31% from 30.93%, the yen's fell to 7.59% from 8.33% and the British pound fell to 7.44% from 8.09%.
The IMF said in a statement its executive board had determined the weighting based on trade and financial market developments from 2017 to 2021.
"Directors concurred that neither the COVID-19 pandemic nor advances in Fintech have had any major impact on the relative role of currencies in the SDR basket so far," the IMF said.
Although the yuan's value has declined recently, it has risen roughly 2% against the dollar since 2016, and appreciated about 6% against its major trading partners.
In a statement on Sunday, the People's Bank of China said China will continue to promote the reform and opening of its financial market.
The updated weightings take effect on Aug. 1.
Reporting by Tony Munroe in Beijing; Editing by William Mallard
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.