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IMF chief supports Yuan's inclusion to currency basket

IMF chief supports Yuan’s inclusion to currency basket

(16 November 2015 – China) The head of the International Monetary Fund (IMF), Christine Lagarde says she supports adding China to its Special Drawing Rights (SDR) basket.

Lagarde on Friday that she supports findings by IMF staff that the Yuan meets the criteria for inclusion in the basket alongside the US dollar, euro, pound and Japanese yen. The Fund’s executive board will meet later this month to make its final recommendation.

Beijing has vigorously campaigned for its inclusion, which would potentially increase demand for the yuan in addition to signalling a symbolic coming of age for the world's second-largest economy.

According to Lagarde, IMF staff had found the yuan met the criteria of being “freely usable,” or widely used for international transactions and widely traded in major foreign exchange markets.

“I support the staff’s findings," she said in a statement.

People’s Bank of China has rolled out a suite of reforms recently to liberalise its markets and also help the yuan meet the IMF's checklist, including scrapping a ceiling on deposit rates, issuing three-month Treasury bills weekly and improving the transparency of Chinese data.

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