According to media reports, the final decision on the possible inclusion of the yuan in the basket of reserve currencies by the IMF will be made by the Executive Board of the International monetary Fund.
MOSCOW, 26 Jan. The Executive Board of the International monetary Fund (IMF) in November to make a decision on the inclusion of the Chinese yuan in the currency basket of special drawing rights (SDR), Reuters reports citing people familiar with the discussions, the sources.
Currently, the basket of reserve currencies of the IMF consists of the us dollar, Euro, Japanese yen and British pound sterling. The Fund revises the composition of the basket of reserve currencies every five years. In August, the IMF Board of Directors approved the extension of the period of expansion of the SDR basket of nine months from 31 December to 30 September 2016.
According to other sources the Agency, the decision on inclusion of the yuan in the SDR basket may be postponed until the beginning of 2016. However, regardless of the timing of the announcement of the decision of the IMF, changes in the composition of the basket will come into effect in October 2016.
“The decision on the possible inclusion of the yuan in the SDR basket will ultimately be made by the Executive Board of the IMF, when the meeting will take place”, — said the Agency representative of the organization.
Three people close to discussions of the IMF, told the Agency that the draft report reached positive conclusions on the inclusion of the yuan in the currency basket. “Everything is technically in force and no obvious political obstacles. The report clearly argues for the inclusion of the yuan in the basket but leaves the decision to the Council”, — quotes Agency of one of the sources. Two other sources told that the staff will recommend the annexation of the yuan to the basket.
Beijing insists on including the yuan in the SDR basket. The initiative is part of a long-term strategic goal of China to reduce dependence of the local currency against the dollar. China in the past few months adopted a number of reforms to liberalize their markets to help the Renminbi to pass the SDR and freely used for international payments and trade in the currency markets.