The valuation of the SDR, created in 1969, is based on a basket of five major international currencies: the dollar, the euro, the British pound, the Chinese renminbi or yuan, and the Japanese yen.
The Chinese currency entered the very closed club of the main international reserve currencies in 2016 by integrating the SDR. This had been hailed as a historic and symbolic step in the internationalization of the renminbi, something Beijing coveted in its quest for international economic recognition.
At the end of the IMF’s five-year review of the weighting of this basket of currencies, the weight of the dollar also rose, which came to represent 43.38% instead of the previous 41.73%, the Fund said in a statement.
This represents a rise of 1.65 percentage points, greater than the increase in the weight of the Chinese renminbi.
This strengthening of the yuan’s participation in the indicator occurs at a time when the Chinese currency is experiencing a sharp depreciation.
Its price, which evolves in a range controlled by the Chinese state, has recently accelerated its decline and stood at 6.7893 renminbi per dollar on Friday.
This is its lowest for almost a year and a half, weighed down in particular by the slowdown in activity due to the fight against COVID-19.