IMF’s Reserve Currencies Need The Renminbi by Dan Steinbock
Adding the renminbi in the IMF’s basket is the first step in opening up the world’s elite reserve currencies to emerging economies.
Currently, the International Monetary Fund’s (IMF’s) basket of major reserve currencies has only four members: the US dollar, the euro, the British pound and the Japanese yen. But things are about to change now as the IMF’s Board has accepted the membership of China’s renminbi in its elite basket.
The renminbi will be the first emerging-economy currency to join the IMF’s Special Drawing Rights (SDR) basket. Indeed, the IMF’s endorsement marks the most critical change to the basket since its creation almost half a century ago.