The Hong Kong Monetary Authority has welcomed the International Monetary Fund Executive Board's decision to include the renminbi in the Special Drawing Rights (SDR) currency basket from October 1, 2016.
Authority Chief Executive Norman Chan said today the decision confirms that the RMB is a freely usable currency, enhances the reserve currency basket's representativeness, and marks a key milestone in RMB internationalisation.
"Being the largest offshore RMB business centre with close economic and trade ties with Mainland China, Hong Kong should seize this historic opportunity and continue to strengthen our financial market infrastructure, as well as upgrading our talent pool and products. I believe Hong Kong can continue to play a pivotal role of bridgehead and financial hub in the process of Mainland's further opening up its financial markets and RMB internationalisation", Mr Chan said.
The SDR is an international reserve asset created by the IMF and its value is determined as a weighted average of the basket currencies, currently comprising the US dollar, euro, pound sterling and Japanese yen.
The IMF reviews the SDR's composition every five years to ensure that it reflects the relative importance of currencies in the world's trading and financial systems.
The decision to include the RMB was made during its November 30 meeting.
