This is basically just China repeating what they said earlier this year at the G20 meeting. But this article does add that the IMF agrees with China and will start a study on wider adoption for the SDR. Below are quotes from the article with some points I wanted to emphasize underlined in bold.
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Chinese central bank governor Zhou Xiaochuan on Saturday called for broadening the use of the International Monetary Fund (IMF)'s basket of reserve currencies to advance the reform of the International Monetary System (IMS).
"The IMS has inherent deficiencies and faces new challenges from globalization, financial innovation, and volatility in capital flows," Zhou said in a statement for the meeting of the International Monetary and Financial Committee (IMFC), the IMF's policy setting committee, on the sidelines of the spring meetings of the IMF and the World Bank.
"The SDR has the potential to resolve the existing deficiencies in the IMS," Zhou said, referring to the Special Drawing Right, an international reserve asset created by the IMF in 1969. The value of the SDR is currently based on a basket of four major reserve currencies: the U.S. dollar, euro, the Japanese yen, and British pound. The IMF decided last year to include the RMB in its SDR basket as the fifth currency, effective October 1, 2016.
"We can start now to gradually broaden the use of the SDR, including using it as a reporting currency in parallel with the USD and exploring issuance of SDR-denominated assets," Zhou said, adding that China has released foreign exchange reserve data denominated in the SDR in addition to the U.S. dollar starting from this month.
Zhou said China will also explore issuing SDR-denominated bonds in the domestic market and look forward to the IMF's further analysis on strengthening the role of SDR this year.
"We support the examination of the possible broader use of the SDR," the IMFC said Saturday in a communique after the meeting of the 24-member committee.
"The IMF will discuss the case for a general allocation of SDRs and the reporting of official reserves in SDR," the communique said.
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My added comments:
Please note that once again China talks about "gradually" broadening use of the SDR. What is new here (at least to me) is the IMF statement saying they support "examination of the possible broader use of the SDR." Now we have more than just China talking about the idea (see point #5 in official IMF communique).
Added note: Here are two more articles on China's call for more use of the SDR:
Some quotes from the South China Morning Post article just below:
"The SDR, a weighted average of various currencies, was created half a century ago as an alternative medium to the US dollar for governments and central banks to use to hold international reserves, but it never really gained momentum.
Now, with six months to go until the yuan is included in the IMF’s basket of currencies – alongside the US dollar, the euro, the British pound and the yen – China is reviving the earlier attempts."
. . . . .
"Measuring foreign exchange reserves using SDR could reduce valuation fluctuations and strengthen the role of SDR as an account unit, China’s central bank said in a one-paragraph statement. Alan Wheatley, an associate fellow of international economics at the British think tank, Chatham House, said the central bank’s move showed two things.
“First of all, they are playing the game as a serious member of the IMF, and secondly, it underlines, perhaps, that it is now tracking the basket, rather than the dollar.”
The idea of China issuing bonds denominated in SDR was “very interesting and potentially significant”, he said. “The SDR has been a failure – the SDR never took off as a private sector asset … but if China is doing that, then it could be different.”
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