{"id":14433,"date":"2015-11-15T08:45:10","date_gmt":"2015-11-15T13:45:10","guid":{"rendered":"http:\/\/olduvai.ca\/?p=14433"},"modified":"2015-11-15T08:45:26","modified_gmt":"2015-11-15T13:45:26","slug":"imfs-lagarde-anoints-chinese-yuan-will-it-now-demolish-the-dollar-hegemony","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=14433","title":{"rendered":"IMF\u2019s Lagarde Anoints Chinese Yuan. Will it Now Demolish the \u201cDollar Hegemony?\u201d"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/11\/14\/chinese-yuan-has-arrived-at-elite-club-for-sinners-currency-warriors-the-dollar-euro-yen-and-pound\/\" target=\"_blank\">IMF\u2019s Lagarde Anoints Chinese Yuan. Will it Now Demolish the \u201cDollar Hegemony?\u201d<\/a><\/h3>\n<p class=\"entry-meta\">IMF boss Christine Lagarde is gung-ho about it. IMF staff is too. The Executive Board will consider it on November 30 and in all likelihood approve it. It will take effect in October 2016. Then it\u2019s a done deal: the Chinese yuan will be added to the IMF\u2019s currency basket, the Special Drawing Rights (SDR). A step toward becoming a major global reserve currency.<\/p>\n<\/header>\n<div class=\"entry-content\">\n<p>IMF staff had determined that the yuan meets the requirements of being a \u201cfreely usable\u201d currency, Lagarde said in a\u00a0<a href=\"http:\/\/www.imf.org\/external\/np\/sec\/pr\/2015\/pr15513.htm\" target=\"_blank\">statement,<\/a>\u00a0so a currency that is \u201c\u2018widely used\u2019 for international transactions and \u2018widely traded\u2019 in the principal foreign exchange markets.\u201d<\/p>\n<p>China also overcame other hurdles the IMF had put before it, after numerous reforms to liberalize its currency and credit markets and offer more transparency. The IMF\u2019s Executive Board has the final say, but Lagarde will chair the meeting. And the rubber stamps are lined up on the conference room table.<\/p>\n<p>Some countries, including France and Britain, have already expressed support for the change. According to\u00a0<a href=\"http:\/\/www.reuters.com\/article\/2015\/11\/13\/us-imf-china-yuan-idUSKCN0T22OC20151113\"><u>Reuters,<\/u><\/a>\u00a0a Treasury spokesperson said the US government has always backed the yuan\u2019s inclusion if it met the IMF\u2019s criteria, and would \u201creview the IMF\u2019s paper in that light.\u201d<\/p>\n<p>The yuan has arrived \u2013 at the elite club for the biggest currency warriors: the dollar, the yen, the euro, and the pound.<\/p>\n<p>China has long sought to give its currency more global weight, both as payments currency and ultimately as reserve currency, given the enormous size of its economy. By being included in the SDR, the yuan moves a big step closer, becoming more palatable for central banks to add to their foreign exchange reserves.<\/p>\n<p>Currency analysts peg central-bank demand for the yuan at over $500 billion, according to Reuters. But global foreign exchange reserves have been shrinking since last year, as this chart by\u00a0<a href=\"https:\/\/www.nbc.ca\/en\/rates-and-analysis\/economic-analysis.html\"><u>NBF Economics and Strategy<\/u><\/a>\u00a0shows:<\/p>\n<p><a class=\"image-anchor\" href=\"http:\/\/wolfstreet.com\/wp-content\/uploads\/2015\/11\/Global-foreign-exchange-holdings-q2-2015.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-19413 aligncenter\" src=\"http:\/\/wolfstreet.com\/wp-content\/uploads\/2015\/11\/Global-foreign-exchange-holdings-q2-2015.png\" alt=\"Global-foreign-exchange-holdings-q2-2015\" width=\"370\" height=\"464\" \/><\/a><\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>IMF\u2019s Lagarde Anoints Chinese Yuan. Will it Now Demolish the \u201cDollar Hegemony?\u201d IMF boss Christine Lagarde is gung-ho about it. IMF staff is too. The Executive Board will consider it on November 30 and in all likelihood approve it. It will take effect in October 2016. Then it\u2019s a done deal: the Chinese yuan will [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,5],"tags":[2160,6177,951,9064,418,434,1085,1086,839],"class_list":["post-14433","post","type-post","status-publish","format-standard","hentry","category-economics","category-geopolitics","tag-chinese-yuan","tag-christine-lagarde","tag-currency","tag-dollar-hegemony","tag-imf","tag-international-monetary-fund","tag-sdr","tag-special-drawing-rights","tag-us-dollar"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14433","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14433"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14433\/revisions"}],"predecessor-version":[{"id":14435,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14433\/revisions\/14435"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14433"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14433"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}