08.12.2015 - Why including yuan in IMF SDR basket may not be good for the world and Chinese economy
The recent inclusion of the Yuan in IMF's SDR basket may not be entirely good news for that country. Further, an imploding China will lead to more pain for emerging markets. To put it in perspective, Saugata Bhattacharya, Chief Economist, Axis Bank hits the nail on the head when he says: "While a significant step in internationalizing the Yuan, the implications on global foreign exchange rate and the Indian Rupee are likely to be limited in the near term. India should utilize the opportunity to diversify its currency holdings." Dong Bao of Credit Suisse says: "The IMF's executive board announced it will include CNY (Chinese Yuan Remnibi) into its Special Drawing Rights (SDR) basket. After the inclusion of CNY, the SDR basket will include USD, EUR, CNY, GBP, JPY. CNY will be given 10.92% weights in the SDR basket." ..............................................Full Article: Source
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