Central banks invest in yuan, put it near reserve status
Apr 7, 2014 5:53:46 GMT -5
Post by popcorn on Apr 7, 2014 5:53:46 GMT -5
Central banks’ investment in yuan puts currency nearer reserve status
At least 40 central banks have invested in the yuan and several others are preparing to do so, putting the mainland currency on the path to reserve status even before full convertibility, Standard Chartered said.
Twenty-three countries have publicly declared their holdings in yuan, in either the onshore or offshore markets, yet the real number of participating central banks could be far more than that, said Jukka Pihlman, Standard Chartered’s Singapore-based global head of central banks and sovereign wealth funds.
Pihlman, who formerly worked at the International Monetary Fund advising central banks on asset-management issues, said at least 12 central banks had invested in yuan assets without declaring they had done so.
The US dollar is still the world’s most widely held reserve currency, accounting for nearly 33 per cent of global foreign exchange holdings at the end of last year, according to IMF data. That ratio has been declining since 2000, when 55 per cent of the world’s reserves were denominated in US dollars.
Pihlman said “a great number of central banks are in the process of adding [yuan] to their portfolios”.
“The [yuan] has effectively already become a de facto reserve currency because so many central banks have already invested in it,” he said. “The [yuan] may become a de facto reserve currency before it is fully convertible.”
read more:
www.scmp.com/business/banking-finance/article/1466621/central-banks-investment-yuan-puts-currency-nearer-reserve
At least 40 central banks have invested in the yuan and several others are preparing to do so, putting the mainland currency on the path to reserve status even before full convertibility, Standard Chartered said.
Twenty-three countries have publicly declared their holdings in yuan, in either the onshore or offshore markets, yet the real number of participating central banks could be far more than that, said Jukka Pihlman, Standard Chartered’s Singapore-based global head of central banks and sovereign wealth funds.
Pihlman, who formerly worked at the International Monetary Fund advising central banks on asset-management issues, said at least 12 central banks had invested in yuan assets without declaring they had done so.
The US dollar is still the world’s most widely held reserve currency, accounting for nearly 33 per cent of global foreign exchange holdings at the end of last year, according to IMF data. That ratio has been declining since 2000, when 55 per cent of the world’s reserves were denominated in US dollars.
Pihlman said “a great number of central banks are in the process of adding [yuan] to their portfolios”.
“The [yuan] has effectively already become a de facto reserve currency because so many central banks have already invested in it,” he said. “The [yuan] may become a de facto reserve currency before it is fully convertible.”
read more:
www.scmp.com/business/banking-finance/article/1466621/central-banks-investment-yuan-puts-currency-nearer-reserve