Further to my research paper "The Ascent of the RMB, the Chinese currency" dated Decemebr, 2013, a latest update is provided in a report by ASIFMA (Asia Securities Industry & Financial Markets Association) dated May, 2014.
Download RMB Roadmap - May, 2014
This report outlines various routes whereby the RMB is rapidly attaining the position as a global currency for trade settlements. As the world's premier commodities consumer, China is well poised to have more energy contracts denominated in RMB. More and more of China's large number of trading partners are beginning to hold some RMB as a "de facto" reserve currency, even as the Chinese currency is not fully convertible.
Following reforms introduced at the 18th Party Congress Third Plenum, more liberalization of China's financial system is on track. This is now being accelerated by such schemes as the Shanghai Experimental Free Trade Zone, the China-Hong Kong Mutual Fund Recognition scheme and Shanghai-Hong Kong Stock Connect pilot program.
By 2020, it is expected that the RMB capital account will have become basically fully open. While the greenback will still be the dominant international reserve currency, the RMB will have come close to being another international currency like the euro, the British Pound or the Japanese yen.
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