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Established in 2006 as a Community of Reality

Welcome to the Neno's Place!

Neno's Place Established in 2006 as a Community of Reality


Neno

I can be reached by phone or text 8am-7pm cst 972-768-9772 or, once joining the board I can be reached by a (PM) Private Message.

Established in 2006 as a Community of Reality

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Established in 2006 as a Community of Reality

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    China’s renminbi currency to become 10 per cent of global reserves by 2025

    Proven
    Proven
    Proven
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    Posts : 1856
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    • Post n°1

    reserves - China’s renminbi currency to become 10 per cent of global reserves by 2025 Empty China’s renminbi currency to become 10 per cent of global reserves by 2025

    Post by Proven Mon 13 Apr 2015, 11:13 am

    China’s renminbi currency to become 10 per cent of global reserves by 2025

    PUBLISHED : Monday, 13 April, 2015, 10:45am
    UPDATED : Monday, 13 April, 2015, 4:26pm

    Ray Chan

    ray.utchan@scmp.com


    International Monetary Fund managing director Christine Lagarde speaking in Washington, DC. Photo: Reuters

    China’s renminbi is expected to represent 10 per cent of global reserves by 2025, up from a 2.9 per cent share by the end of 2015, according to a survey of 72 central banks responsible for US$5.9 trillion in reserves.

    Thirty-five central banks, or 53 per cent of respondents, said they were either investing or considering investing in the Chinese currency, although they retain concerns over its convertibility, the liquidity of markets, and the quality of credit in some cases, said a joint report by Central Banking and HSBC on Monday.

    The report was released before the International Monetary Fund starts discussing the possibility of adding the yuan to the ranks of the world’s reserve currencies in May.

    The renminbi halted its four-month decline in March as Premier Li Keqiang and central bank governor Zhou Xiaochuan expressed their hopes for the yuan’s inclusion in the IMF currency basket. The Chinese currency fell 2.4 per cent against the US dollar last year, the first annual depreciation of theyuan since the central bank ended its dollar peg in 2005.

    IMF’s head Christine Lagarde welcomed the proposal, saying inclusion of the Chinese yuan to the dollar, euro, yen, and pound in the Special Drawing Rights basket is only a matter of time and the move will expand its role as a currency for international trade and investment, allowing more central banks to hold it in their reserves.

    A clear roadmap of the renminbi’s full convertibility remains one of its biggest challenges.

    A reserve manager whose views were close to the average commented: “Although central banks have already started gaining exposure to the renminbi, the pace at which the renminbi becomes a large reserve currency will depend on the growth and stability of the economy; the pace of the internationalisation of the currency, and deepening of the financial markets.”

    Asian central banks seem to be the most optimistic about the future of renminbi, with one reserve manager saying the share would reach 50 per cent by 2030.

    “Reserve managers seem to be caught between a rock and a hard place, with deep concerns about both negative rates in Euro and the prospect of rising rates in the USD, a currency which by default has become increasingly pre-eminent as a reserve currency,” said Christian Deseglise, Global Head of Central Banks & Reserve Managers at HSBC.

    “In this context, the continued adoption and steady rise of the RMB in central bank reserves is striking. Its possible inclusion in the SDR basket later this year would obviously accelerate the trend and, with the appropriate market reforms in China, enhance the range of available investment options for reserve managers.”

    http://www.scmp.com/business/money/money-news/article/1765304/chinas-renmimbi-currency-become-10-cent-global-reserves
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