The International Monetary Fund’s executive board announced Monday that effective Oct. 1, the Chinese renminbi will be included in the Special Drawing Rights basket for the first time.
The renminbi will have a 10.92% weighting in the basket and the IMF said, “the three-month benchmark yield for China Treasury bonds will serve as the RMB-denominated instrument in the SDR interest rate basket.”
The biggest loser in the latest valuation (which occurs every five years) was the euro, whose weighting in the basket dropped 6.47 percentage points. The pound sterling weighting dropped 3.21 percentage points, while the U.S. dollar’s fell 0.17 percentage points.
The SDR is a supplementary international reserve asset created by the IMF in 1969. According to the IMF, 204.1 billion SDRs had been created and allocated to members (about $285 billion) as of Nov. 30. Its value is determined daily based on each respective currency’s valuation vs. the U.S. dollar.