You are here: Home » International » News » Others
Business Standard

IMF increases weighting of dollar, yuan in SDR basket amid weakness

The IMF raised the yuan's weighting to 12.28 per cent from 10.92

International Monetary Fund | Yuan | Chinese central bank


Yuan, Chinese currency, FDI, Chinese investments, China investments
Photo: Shutterstock

The Monetary Fund lifted the yuan’s weighting in the Special Drawing Rights currency basket, prompting the to pledge to push for a further opening of its .

The IMF raised the yuan’s weighting to 12.28 per cent from 10.92 in its first regular review of the SDR evaluation since the Chinese currency was included in the basket in 2016, the People’s Bank of said in a statement Sunday. The weighting of the US dollar rose to 43.38 per cent from 41.73 per cent, while those of euro, Japanese yen and British pound declined.

The PBOC and other regulators “will continue to resolutely push for the opening up of China’s and further simplify the process of overseas investors coming into the Chinese market,” it said in the statement.

SDRs are an reserve asset that can be converted into five currencies. The yuan’s entry into the SDR signaled it became one of the five global reserve currencies in 2016, after years of effort by Chinese authorities to promote its global use.


The change came amid a sharp depreciation of the since late April, as it faces a double whammy of slowing domestic growth because of Covid-induced lockdowns and capital outflows due to its widening monetary policy divergence with the US. The PBOC set its reference rate for the at a stronger-than-expected level for a ninth straight day on Friday, underpinning its support for the currency.

In its statement on Sunday, the PBOC vowed to extend the interbank foreign exchange trading time, make more types of assets available and improve information disclosure in order to provide better investment conditions to global institutions.

The ranking of the currencies’ weighting remains the same after the review, according to an IMF statement released late Saturday, with the continuing to be in third place. The change will be effective Aug 1, and the next review will be in 2027.

IMF’s executive directors concurred that neither the pandemic nor developments in financial technology have had any major impact on the relative role of currencies in the SDR basket so far.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Mon, May 16 2022. 02:31 IST