Photo: Sputnik/ Alexandr Demyanchuk
The International Monetary Fund (IMF) has given the Chinese yuan, also known as the renminbi, a status of reserve currency, IMF Managing Director Christine Lagarde said in a statement on Monday, Sputnik News reports.
“The Executive Board’s decision to include the RMB in the SDR [special drawing rights] basket is an important milestone in the integration of the Chinese economy into the global financial system,” Lagarde said.
To meet the IMF’s criteria, Beijing has recently instituted multiple reforms, including better access for foreigners to Chinese currency markets, more frequent debt issuance and expanded yuan trading hours, Reuters reported.
Lagarde said she expects the measures to continue.
“The continuation and deepening of these efforts will bring about a more robust international monetary and financial system, which in turn will support the growth and stability of China and the global economy,” she said in a statement.
The yuan’s inclusion is a largely symbolic move, with few immediate implications for financial markets.
The yuan is not set to officially become a reserve currency until September 2016. The Chinese currency is expected to contribute to the value of the special drawing right – a weighted average of the currencies – which the IMF uses to price its emergency loans.