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China had to make some concessions to get the yuan into the SDR basket. Most notably they have committed to issue 3 month T-Bills every week and to allow forei
by chollida1 11y ago
China had to make some concessions to get the yuan into the SDR basket.
Most notably they have committed to issue 3 month T-Bills every week and to allow foreign central banks to access their currency and bond markets.
Note also that this doesn't take place until October of 2016 so there should be no immediate impact on the markets. Also note the SDR has a very minor share of the global currency reserves so this is more symbolic at the moment.
- tomp 11y ago> Also note the SDR has a very minor share of the global currency reserves so this is more symbolic at the moment. More (10.92%) than GBP (8.09%) and JPY (8.33%) actually.
- chollida1 11y agoWhere do you see that SDR is 10.92% of all global currency reserves. I can't find anything that shows SDR being anywhere close to that amount. See here: https://en.wikipedia.org/wiki/Special_drawing_rights#Allocations https://en.wikipedia.org/wiki/Special_drawing_rights#Allocat...
- tomp 11y agoAha, I get it. I misread your statement. I thought you were saying that CNY is a small share of SDR, not that SDR is a small share of all global reservers. My apologies.
- socrates1998 11y agoYeah, I didn't know the details, but China for sure had to make some concessions to get in. It will be interesting to see how much they allow their currency to float and how much more (if any) they will allow their citizens to expatriate the yuan.