International Monetary Fund staff are set to give the all-clear for China’s renminbi to be included in the lender’s benchmark currency basket, laying the groundwork for a favorable decision by policymakers, people familiar with the discussions said.
The IMF executive board is scheduled to decide in November on whether the Chinese currency will be put on a par with the dollar, yen, euro and pound sterling, and a key factor will be its performance against a checklist of technical criteria, as assessed by IMF staff, Reuters reported.
A draft report from staff reached a favorable conclusion on including the renminbi (RMB), also known as yuan, the news agency said, citing three unnamed officials briefed on the IMF discussions.
“Everything is on course technically and there is no obvious political obstacle. The report leans clearly towards including the RMB in the [basket] but leaves the decision for the board,” one of the officials said, although the original early November date for staff to circulate their report to board members has been pushed back by several weeks.
Two other officials said staff would recommend the renminbi join the basket, which determines the mix of currencies that countries like Greece receive as part of disbursements from the IMF.
“There is no real discussion, no obstacles, all seems on course,” a second official said.
Beijing is pushing for the RMB to join the Special Drawing Rights (SDR) basket as part of its long-term strategic goal of reducing dependence on the dollar and to mark the country’s coming of age as an economic power.
An IMF spokesman said staff were finalizing a report to be considered at a formal board meeting planned for November, although no date had yet been set.
“The decision on the possible inclusion of the RMB in the SDR basket will ultimately be made by the IMF’s Executive Board when the meeting is held,” he said.
The second official said that may be postponed until early 2016. Any change to the basket will take effect in October 2016.
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