The Chinese yuan continues to gain stature on the world financial stage, overtaking the Japanese yen to become the 4th most-used currency for global payments, boosting its claim for reserve status…
The commentary above & below consists of edited excerpts from an article by Peter Schiff (schiffgold.com). See the original article HERE.
The Chinese currency has skyrocketed up the rankings, rising from 35th in 2010, to 5th this past November and to its current position in August so it’s no wonder the Chinese have been pushing for inclusion in the International Monetary Fund’s Special Drawing Rights basket (currently comprised of the U.S. dollar, euro, yen, and the British pound) which Standard Chartered Plc. claims could trigger as much as $1 trillion of inflows into the currency.
China has been going to great pains to elevate the stature of its currency. As Bloomberg put it:
China is trying to increase the yuan’s usage around the world as it looks to reduce the dollar’s dominance of global trade. The People’s Bank of China has appointed yuan-clearing lenders in 10 countries including South Africa and Argentina in the past year and opened the local bond and currency markets to overseas central banks.
In addition, the Chinese central bank has also been buying up gold (in July China announced its gold holdings for the first time since 2009, revealing a 57% growth in its stash and increased its stash another 1% in August), and many analysts believe it is part of the push to stabilize the yuan in the eyes of the international community.
The IMF is scheduled to begin its twice-a-decade review of the basket before the end of the year.
The above article has been edited by Lorimer Wilson, editor of munKNEE.com (Your Key to Making Money!) and the FREE Market Intelligence Report newsletter (see sample here – register here) for the sake of clarity ([ ]) and brevity (…) to provide a fast and easy read.
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