Chinese yuan set to be inducted into IMF currency basket

This photo illustration shows Chinese 100 yuan, 10 yuan and one yuan notes in Beijing. (AFP)

WASHINGTON: China’s yuan is poised to enter the International Monetary Fund’s elite SDR basket of currencies, raising Beijing’s banknotes to the status of global reserve asset.
In a policy milestone long sought by the Chinese government, which oversees the world’s second-largest economy, the yuan now joins a prestigious club of major international reserve currencies also comprising the US dollar, pound, yen and euro.
The move will formally occur Saturday, with the yuan’s induction following a decision first announced in November last year, when the IMF found that China’s currency met the standard of being “freely usable.”
Beijing has sought in recent years to expand use of the yuan, also known as the renminbi, or “people’s currency,” which has doubled its share of global currency trading to an average daily turnover of $202 billion since 2013, moving well into the top 10 but still trailing other major currencies, according to the Bank for International Settlements.