Much has been said that the RMB's inclusion in the IMF's Special Drawing Rights (SDR) is no more than symbolic. Like a student wining a Gold Star at elementary school, says Ben Bernanke on his Brookings blog. The New York Times is more sanguine, pointing out that it "will help pave the way for broader use of the renminbi in trade and finance, securing China’s standing as a global economic power".
In any event, this has been a planned and hard-won prize for China, however symbolic to start with. After all, the RMB is given the third place (11%) in weight in the make-up of the SDR, after the dollar (42%) and the euro (31%) but ahead of the British Pound (8%) and the Japanese yen (8%).
The Financial Times has come up with a basket of perhaps more focused and in-depth analyses. The SDR decision was seen as a pivotal moment, a historic vote of confidence in China's on-going financial reform. Albeit still relatively minor in global usage compared with the US dollar, China's One Belt, One Road is likely to turbo-charge its popularity, says the financial newspaper.
Nevertheless, winning this SDR accolade may not translate into RMB appreciation, at least in the near term. The Economist explains why.
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