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China’s central bank welcomes IMF chief’s statement on RMB

Updated: Nov 14,2015 10:57 AM     Xinhua

BEIJING — China’s central bank, welcomed on Nov 14 a statement by Christine Lagarde, managing director of the International Monetary Fund (IMF), on IMF’s quinquennial review of Special Drawing Rights (SDR) basket of currencies.

Lagarde said in a statement on Nov 14 that the staff experts, in their report to the IMF Executive Board, assessed the yuan or renminbi (RMB) “meets the requirements to be a ‘freely usable’ currency and, accordingly, the staff proposes that the Executive Board determine the RMB to be freely usable and include it in the SDR basket as a fifth currency, along with the British pound, euro, Japanese yen, and the US dollar.”

“I support the staff’s findings. The decision, of course, on whether the RMB should be included in the SDR basket rests with the IMF’s Executive Board. I will chair a meeting of the Board to consider the issue on November 30,” said Lagarde.

The People’s Bank of China (PBOC), the central bank, expressed appreciation for IMF staff experts’ analysis and suggestion, hailing their opinion as a recognition for China’s achievements on economic growth and opening up.

It will be a win-win result for both China and the world if the RMB could be included in the SDR basket as it will strengthen the SDR’s representativeness and attraction and optimize current international currency system, according to the PBOC authorities.

Hoping that all relevant sides could support RMB’s inclusion in the SDR, China is looking forward to the Executive Board’s decision on Nov 30 and will respect the result, according to the PBOC.

In future, China will unswervingly continue to push forward the strategic plan of comprehensively deepening reform and will steadily promote financial reform and opening up, it said.

The yuan failed to be included in the SDR in 2010 when the IMF said the currency did not meet the “freely usable” criteria, which was deemed as a key hurdle to the yuan joining the basket.