by Marc Chandler
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I had the privilege of being on CNBC to discuss the significance of China being included in the IMF's Special Drawing Right. Here is the link to the discussion.
The decision was announced shortly after the interview on CNBC. It was largely a foregone conclusion that China would join. Besides the confirmation, the new news was in the weighting. China's yuan got an almost 11% share of the new SDR that will be launched 1 October 2016.
The room for the yuan comes comes mostly at the expense of Europe (euro and sterling). The dollar's weighting is little changed at 41.73% vs 41.90% previously. Among the five currencies that will make up the SDR, sterling has the least weight 8.09% (down from 11.3%). The yen, which had the lowest weighting (of 9.4%), is now in fourth place with 8.33%. The euro took the biggest hit. Its share of the SDR was cut to 30.93% (from 37.4%).
He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.
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