China is working to position the RMB as a reserve currency, possibly to even out the USD as the world’s oil reserve currency. One a currency that wasn’t used outside of China, roughly 30% of all international business done with China is now in RMB. Through careful manipulation of the RMB’s value, China now possesses the fifth largest reserve currency in the world. Quite an increase from 15th not 10 years ago.
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Description
China is working to position the RMB as a reserve currency, possibly to even out the USD as the world’s oil reserve currency. One a currency that wasn’t used outside of China, roughly 30% of all international business done with China is now in RMB. Through careful manipulation of the RMB’s value, China now possesses the fifth largest reserve currency in the world. Quite an increase from 15th not 10 years ago.
Accompanying this meteoric rise in the RMB are calls for the RMB to join the IMF’s SDR as the fifth reserve currency (the four currently being the USD, GBP, JPY, and EUR). Should this happen, it may even allow SDRs to move to currency status itself due to the strength of the five currencies that would make up its value.
One of the main proponents for the RMB joining the SDR is George Soros, who likely has an RMB position driving his recent extreme comments regarding the RMB, and he tends to act around events of great import.
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Notes
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