Since the financial crisis, the "Domination of the U.S. Dollar" has given rise to "My Dollar, Your Problem"; in addition, the IMF's 2010 quota and governance reforms were unable to be passed due to repeated obstruction by the U.S. Congress, which made China and other emerging market countries in the IMF

voting power cannot match its rising economic status.

Even though the existing international monetary system has been criticized, all sectors of society seem unable to reverse the status quo.

Regarding Lagarde's statement on the 14th, the relevant person in charge of the People's Bank of China said: "The addition of RMB to the SDR will help enhance the representativeness and attractiveness of the SDR and improve the current international monetary system. It is a win-win result for China and the world." It is undeniable.

Yes, the expansion of the SDR basket will help enhance the stability, representativeness and legitimacy of the SDR, and help the current international monetary system develop into a more stable multi-reserve currency system.

In terms of stability, Indian economist Arvind Subramanian previously pointed out that 7 of the ten East Asian countries have currencies that are more closely tied to the RMB than the U.S. dollar, and the appreciation of the RMB

If the dollar appreciates by 1%, the currencies of these seven countries will appreciate by 0.55%, while if the dollar appreciates by 1%, the currencies of these seven countries will appreciate by only 0.34%.

As for representativeness and legitimacy, Qiao Yide, vice president and secretary-general of the Shanghai Development Research Foundation, previously told China Business News: "Currently, except for the euro replacing the German mark and the French franc in 2000, the composition of the SDR basket has

It has not changed for a long time and cannot reflect changes in the world's economic power structure and the international use and trading of various currencies. Therefore, it is necessary to expand the SDR basket to an appropriate size." He said that if the RMB was added to the basket in 2011,

Since then, the exchange rate fluctuations of SDR relative to the US dollar, British pound and RMB have been greatly reduced.

"According to our calculations, they can be reduced by 13%, 21% and 17% respectively." Of course, SDR still has its own shortcomings.

In terms of monetary functions, SDR only has the functions of value standard, reserve and accounting. Its function as a storage method is also limited by the lack of assets priced with SDR. In addition, SDR lacks the basic functions of a means of circulation and payment.

Therefore, Elena Flor, director of the Triffin Foundation, also recently suggested that the official department should take the lead in providing a suitable structure to help the operation of the SDR market.

“Between 1975 and 1985 SDR was used for bonds, syndicated loans, and to some extent commercial bank deposits and certificates of deposit. Some governments issued SDR-denominated bonds (such as Sweden) but did not reach critical mass. Currently, such as the IMF, etc.

International institutions and governments are the most likely candidates to issue SDR bonds, whose main goal is to reduce foreign exchange risks, as compared to a single currency in a basket of currencies, the SDR basket of currencies is less volatile for investors.

On the other hand, Elena Flor believes that central banks of various countries are the most likely candidates to invest in SDR financial assets. In addition, sovereign funds or pension funds can also use this to make their holdings more diverse.

Promoting China's financial market reform For China, the inclusion of RMB in the SDR is not only the IMF's recognition of the RMB internationalization process, but also China's commitment to continue to promote financial reforms including capital account opening.

Zhu Haibin, chief China economist at J.P. Morgan Chase, said: "The inclusion of the renminbi will be interpreted as the IMF's official endorsement of the renminbi as a freely usable currency, and it also marks the international recognition of China's importance in the international financial market. This also

It will further promote China's domestic financial reform and capital account opening process. "In fact, domestic reform has accelerated rapidly since this year.

The People's Bank of China approved a large number of foreign institutions to enter the interbank bond market at the end of April.

On July 14, the central bank further announced that the quotas for three types of overseas institutions, namely overseas central banks, sovereign wealth funds and international financial organizations, to participate in the interbank bond market will be completed through a filing system without approval, and the scope of investment will also be expanded to

More variety.

The new round of RMB exchange rate reform on August 11 is a milestone.

The central bank announced that it will further improve the central parity quotation of the RMB exchange rate. The central parity will refer to the closing rate of the inter-bank foreign exchange market on the previous day. At the same time, the short-term depreciation of the RMB will be approximately 3%.

Markus Rodlauer, deputy director of the IMF's Asia and Pacific Department, said in a conference call that "China is continuously transforming from a managed exchange rate system that is tightly pegged to the U.S. dollar to an exchange rate system that is more open, flexible and based on market conditions. The RMB should

It can achieve free floating within 2-3 years. "In addition, it is reported that the People's Bank of China may announce in the near future that the trading hours of the inter-bank foreign exchange market will be extended from the current 16:30 to 23:30 to cover the European trading hours and meet the SDR requirements.

Requirements for extensive trading in "major foreign exchange markets around the world".

The plan may be implemented before the end of November.