IMF raises dollar, yuan weight in currency review

IMF raises dollar, yuan weight in currency review

BEIJING Reuters -- The International Monetary Fund said on Saturday it has increased the weight of the dollar and Chinese yuan in its review of the currencies that make up the valuation of its Special Drawing Rights SDR an international reserve asset.

The review was the first since the renminbi joined the basket of currencies in 2016 in what was a milestone in Beijing's efforts to internationalise its currency.

The IMF raised the U.S. currency's weight to 43.38% from 41.73% and the yuan to 12.28% from 10.92%. The euro's weight dropped to 29.31% from 30.93%, the yen's weight fell to 7.59% from 8.33% and the British pound fell to 7.44% from 8.09%.

The IMF said in a statement that it had determined the weighting based on trade and financial market developments from 2017 to 2021.

The directors agreed that neither the COVID 19 pandemic nor advances in Fintech have had a major impact on the relative role of currencies in the SDR basket so far, the IMF said.

Although the yuan's value has declined recently, it has risen about 2% against the dollar since 2016 and appreciated about 6% against its major trading partners.

In a statement on Sunday, the People's Bank of China said that China will continue to promote the reform and opening of its financial market.

The weightings were updated on August 1.