RMB Entering SDR Will Face Challenges And The Weight Will Exceed The Pound Yen.

A 5 year assessment will take place in the second half of 2015.

After the gold and dollar proved to be in short supply, the SDR, founded in 1969, aims to support the Bretton Woods system with fixed exchange rates.

The addition of Renminbi to SDR will bring the renminbi into the basket of currencies that IMF members can calculate to official reserves.

Canada's Scotiabank has recently said in a report that China's determination to open its capital account and reform its exchange rate mechanism foreshadowed that if the RMB was included in the basket of the International Monetary Fund (IMF) special drawing rights (SDR), then the weight in the basket would be higher than that in the pound and yen.

Sacha Tihanyi, a foreign exchange strategist in Hongkong, said that from the perspective of international income data, the size of exports of goods and services is obviously only from this perspective. The weight of the renminbi is unlikely to exceed that of the US dollar and the euro, but it is expected to exceed the weight of the Japanese yen and the pound.

The report shows that Chinese policymakers have shown a willingness to push ahead with exchange rate and capital account reform.

Tihanyi pointed out that the export scale and the use of RMB in trade settlement indicate that its weight in SDR will be relatively high, but the weight as reserve currency will remain relatively low.

IMF President Lagarde (Christine Lagarde) said at the end of March in China that IMF, like the Chinese government, is interested in putting the renminbi in the basket of IMF reserve currencies.

She said that this is not a question whether it will be included, but when.

To win the IMF's reserve currency status, the renminbi must be "freely available". The board of directors of the IMF executive board has great room for explaining this term. The committee will make a decision later this year.

Although China is prudent in managing the value of the renminbi, it does not necessarily lead to the exclusion of IMF from the renminbi.

Over the past few years, China has intensified its efforts to promote the internationalization of RMB.

It may help RMB meet IMF's "free to use" standard.

According to the office of the Commissioner for foreign affairs of the Ministry of foreign affairs of China, the proportion of Renminbi payment to China has increased from 0.02% in 2009 to nearly 25% last year.

At present, there are 15 offshore RMB clearing centers all over the world, and 20 central banks, including Russia, Britain and Australia, have signed a currency swap agreement with China, with a total scale of 430 billion US dollars.

However, it is certain that even if

Becoming a IMF approved reserve currency is unlikely to replace the dominance of the US dollar.

At present, the US dollar accounts for more than 60% of the world's foreign exchange reserves.

Even optimistic economists say,

It may take ten to twenty years to reach a small part of this level.

The former glory of colonial rule and the great God of national belief had given Britain and Japan the reputation of "never declining Empire".

Now, as time flies, the new era seems to be writing a new chapter.

In foreign exchange market, the weight of a country's currency is undoubtedly reflecting the ups and downs of national pportation.

The investment bank's research suggests that if the RMB is included in the SDR basket, the weight in the basket is expected to be higher than the pound and yen.