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What keep yuan from being fully convertible

565 views. 2011-11-29 20:31 |

What is China entitled to receive in exchange for its financial support of eurozone?  It does seem that one of things China most wants is for the Yuan to be included in the basket of currencies that make up IMF's Special Drawing Right , alongside the dollar, the euro, the yen and the pound. And the world seems to be taking this desire seriously. IMF executive boarad debated whether the Fund should abandon its requirement that SDR be composed of 'freely usable' currencies. What keeps the yuan from being fully convertible? One factor is financial repression in China itself. The stability of the Chinese financial system is currently supported by a subsidy from Chinese households that is delivered in the form of a ceiling on deposit rates. Chinese banks fund themselves at lower-than-market rates.

Post comment Comment (1 replies)

Reply Laura_Lucky 2011-11-29 21:14
serious topic .. the world need save  the debt induced economic situation.  restrain from globle melt down...

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