Are you familiar with the SDR’s (Special Drawing Rights) !?
The International Currency issued by the IMF held as reserves in central banks globally.
SDRs are international foreign exchange reserve assets. Allocated to nations by the IMF, an SDR represents a claim to foreign currencies for which it may be exchanged in times of need. Originally created by the IMF in 1969 for members and prescribed holders to use their SDR holdings to conduct transactions with the IMF.
The nominal value of an SDR is derived from a basket of currencies, with, specifically, a fixed amount of Japanese Yen, US Dollars, British Pounds and Euro’s, without RMB.
A senior Chinese central bank official said Thursday that the country is “actively communicating” with the IMF on the possibility of including the yuan, or RMB, in the basket of the Special Drawing Rights (SDRs).
From Wikipedia: Special drawing rights (XDR aka SDR) are supplementary foreign exchange reserve assets
From the IMF: SDR Allocations and Holdings for all members as of February 28, 2015
How will CHINA’s move one step closer to becoming an OFFICIAL RESERVE CURRENCY effect your portfolio !?
China is pushing for the International Monetary Fund to endorse the Chinese Yuan as a global reserve currency alongside the dollar and Euro.
A senior Chinese central bank official said Thursday that the country is “actively communicating” with the IMF on the possibility of including the Yuan, or RMB, in the basket of the Special Drawing Rights (SDRs).
Including the Yuan in the SDR system would allow the IMF to recognize the ascent of the world’s second-biggest economy while aiding China’s attempts to diminish the dollar’s dominance in global trade and finance.
“We hope the IMF can fully take into account the progress of RMB internationalization, to include RMB into the basket underlining the SDR in foreseeable, near future,” said Yi Gang, vice governor of the People’s Bank of China.
The Yuan became the world’s No. 2 currency for trade finance globally in 2013, and overtook the Canadian and Australian dollars to enter the top five world payment currencies in 2014, according to global transaction services organization SWIFT.
China said the Yuan has also been used as a reserve currency in some countries and regions.
LINK TO STORY: China-IMF talks under way to endorse Yuan as global reserve currency