The International Monetary Fund is creeping closer to including China’s renminbi in an elite basket of reserve currencies, with the US and other big shareholders likely to back the move unless IMF staff make a surprise recommendation against inclusion.
But remaining technical hurdles, concerns over Beijing’s heavy-handed intervention in markets and poor communication of reforms such as the changes to its foreign exchange regime that set off a bout of turmoil in global financial markets last month, are causing nervousness within the IMF.
The caution has prompted some IMF staff to raise the possibility that a vote by the fund’s board due to take place in November could be delayed into early next year to give China more time to deliver reforms and build credibility at a time when many outside observers have grown sceptical.