PBOC's Zhou Outlines Plans to Promote IMF Currency Basket Use

  • China soon to start reporting foreign reserves in SDR: Zhou
  • China to look into issuing SDR-denominated bonds, Zhou says

China’s central bank governor, long an advocate for reducing the global reliance on the U.S. dollar, is planning incremental steps in his quest to increase use of the International Monetary Fund’s reserve currency basket.

China will soon start reporting the banking sector’s foreign assets, including the nation’s foreign reserves, in terms of International Monetary Fund’s Special Drawing Rights as well as in U.S. dollars, Governor Zhou Xiaochuan said Thursday in Paris. China also will look into issuing SDR-denominated bonds domestically, Zhou said in a speech at a forum of finance chiefs and central bankers to discuss crisis planning.

The announcement underscores Zhou’s efforts to enhance the role and broaden the use of the SDR unit, to which China’s yuan will be added this year after winning IMF backing in 2015. The 68-year-old People’s Bank of China chief also said that countries should better monitor and deal with capital flows, and that efforts to promote orderly sovereign debt restructuring should continue.

After months of silence, Zhou has re-emerged in recent weeks to reassure that there is no basis for continued currency weakness and that he still has tools to manage the economy.

— With assistance by Xiaoqing Pi

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