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Friday, November 13, 2015
Bloomberg: Yuan Ticks IMF Reserve Entry Boxes
Bloomberg provides a recap of the many actions China has taken to get the IMF to accept the yuan into the SDR currency basket. This makes it pretty clear that China is willing to do whatever the IMF wants to get this done. Below are some quotes from the article.
"China has ticked most of the boxes set by the International Monetary Fund to grant the yuan reserve-currency status, prompting many banks to predict approval this month.
An outright “yes” is the most probable outcome, Goldman Sachs Group Inc. wrote in an Oct. 29 note. JPMorgan Chase & Co. Chief China economist Zhu Haibin said any terms attached may be technical issues. Jukka Pihlman, head of central banks and sovereign wealth funds at Standard Chartered Plc in Singapore and a former adviser to the IMF, said the agency would seek to avoid the uncertainty of conditional approval.
“It’s basically a done deal, unless something really surprising and unexpected happens,” said Pihlman.
China has been seeking to join the Special Drawing Rights basket as part of a campaign to play a larger role in the postwar global economic order dominated by the U.S. and Europe. Membership of the IMF club would be a crowning achievement after three decades of breakneck growth that saw the Chinese economy take its place as the world’s second-largest after the U.S.
Here’s a look at what the IMF, in an Aug. 3staff report, asked China to do, and how the nation has fared so far."