China’s currency may enter the International Monetary Fund’s benchmark currency basket at a lower weighting than the 14% to 16% range economists expect, people briefed on the Fund’s discussions told Reuters.
The Renminbi, also known as the yuan, is expected to be added to the IMF’s Special Drawing Rights basket later this month.
This is the result of a long campaign by Beijing to get the yuan equal billing with the dollar, euro, pound sterling and yen in the IMF’s eyes.
Two people familiar with IMF deliberations told Reuters that policymakers were considering changing the way the weights of currencies in the basket are calculated to make export volumes less important.
That would give the yuan a lower share in the basket than under the current formula. In July, IMF staff calculated that the current formula would give the yuan a weighting between 14% and 16%.
“I would say that it’s too high,” one person briefed on the IMF discussions to Reuters, referring to the estimates.
A second person, an official of a major Asian country who saw the IMF staff report, said: “It’s barely a two-digit rate, just the minimum (rate to be a double-digit one).”
The SDR basket determines the mix of currencies that countries like Greece can receive as IMF disbursements and economists expect that inclusion will boost demand for the yuan.
The basket’ s ratios were last set in 2010. They break down into 41.9% dollar, 37.4% euro, 11.3 % sterling and 9.4% yen.