SDR

More widespread use of the International Monetary Fund's special drawing rights could prevent a currency war, Thierry de Longuemar, chief financial officer at the Asian Infrastructure Investment Bank (AIIB), said on May 4. But the treasurer got little sympathy from other experts at the Asian Development Bank’s meeting.

Germany's domestic central bank said this week that it would start buying renminbi assets. Andreas Dombret, a member of the board at the Bundesbank, indicated to GlobalRMB that the central bank — like others in the developed markets — would follow the European Central Bank’s small initial allocation to the currency.

China got a big PR win when the IMF elevated the renminbi currency to its special drawing rights (SDR) basket, but the real market impact from that decision is yet to be felt.

The transition to a new IMF special drawing rights (SDR) basket, inclusive of the renminbi, is just the starting point for efforts by China and the IMF to see the basket take up a greater role as a global liquidity tool.

In the nascent market for special drawing rights (SDR) denominated bonds, known as Mulan bonds, Standard Chartered (StanChart) managed to increase onshore investor interest in the first deal by a commercial lender in China.

China’s domestic bond market is poised for another landmark transaction with Standard Chartered Bank (Hong Kong) opening books to a special drawing rights-denominated bond on Tuesday.

The African Development Bank could follow the lead of the World Bank in issuing a bond denominated in special drawing rights, its treasurer has told GlobalCapital.

Standard Chartered Bank (Hong Kong) is set to become the first commercial issuer of special drawing rights-denominated bonds. The group’s head of capital markets for Greater China and north Asia told GlobalRMB that the notes are testament to StanChart’s commitment to develop the renminbi markets.

Standard Chartered Bank (Hong Kong) has unveiled the syndicate for its special drawing rights-denominated bond.

Standard Chartered Bank (Hong Kong) has obtained approval from the People’s Bank of China (PBoC) to become the first commercial issuer of bonds denominated in Special Drawing Rights (SDR) in the country’s interbank bond market.

The entry of the renminbi into the IMF special drawing rights (SDR) on October 1 is stirring up debate for a revised role of the SDR, with some suggesting reform of the currency unit could lead to a more stable international monetary system.

With the renminbi now officially part of the special drawing rights basket, China is set to push on with its goal of making the SDR a real-world investment and reserve asset. But the obstacles to that plan are daunting.

Institutions have spent months preparing for the launch of the new IMF special drawing rights (SDR) basket on October 1 since the decision to include the RMB was made last year. The mechanics include managing divergent onshore and offshore rates, Jukka Pihlman, global head of central banks and sovereign funds, Standard Chartered, and former IMF official, told GlobalRMB.

In just a few days, the renminbi will be officially included in the International Monetary Fund’s Special Drawing Rights basket — a move widely seen as a validation of the currency’s internationalisation. But the actual impact of the development on fund flows is expected to be limited, market participants told GlobalRMB.

All eyes are on the renminbi this week with the currency set to officially enter the IMF’s special drawing rights (SDR) basket on Saturday. But what does that mean and why should you care? Here’s GlobalRMB’s quick guide to all you need to know.

The World Bank broke a 30 year silence in special drawing rights (SDR) bonds with the sale of a SDR500m ($700m) three year note in China on Wednesday. While the Mulan bond is widely seen as a symbolic gesture to promote the internationalisation of the renminbi, market participants said it is more than that, in spite of the relatively narrow investor base. Paolo Danese and Rev Hui report.

The World Bank broke a 30 year silence in special drawing rights (SDR) bonds with the sale of the SDR500m ($700m) three year note in China on Wednesday. While the Mulan bond is widely seen as a symbolic gesture to promote the internationalisation of the renminbi, market participants said it is more than just that in spite of the relatively narrow investor base.

China has pushed hard for a greater role for the IMF special drawing rights (SDR) since the global financial crisis. But while the SDR may help the renminbi internationalisation strategy it will not help overthrow the dollar as the de facto world currency, according to Benjamin Cohen, professor of international political economy at the University of California Santa Barbara (UCSB).

The World Bank has announced the price guidance for its upcoming Mulan bond.

Incompatible accounting standards could soon be a thing of the past for foreign issuers looking to tap into China’s onshore bond market with the World Bank’s upcoming SDR trade providing a template on how to get around this long standing issue.

The World Bank’s debut IMF special drawing rights (SDR) bond — dubbed a Mulan bond — is an acknowledgement of China’s success in reforming the renminbi, George Richardson, the organisation’s director and global head of capital markets, told GlobalRMB.

The World Bank began meeting investors this week for a landmark bond denominated in the IMF special drawing rights (SDR), after it gaining approval from the People’s Bank of China. More issuers are lining up to sell SDR bonds, with each trade likely to have unique features.

The World Bank has mandated banks for its landmark Special Drawing Rights (SDR) bond with market participants expecting a strong response from onshore Chinese investors.

With the World Bank set to issue a ground-breaking bond denominated in IMF special drawing rights (SDR) in China this month, markets are starting to take a closer look at what the odds are for the SDR to pull off its transition to a real-world financial instrument.

Despite the technical challenges, it seems likely that People’s Bank of China (PBoC) will give the green light to a bond denominated in IMF special drawing rights (SDR) before the G20 summit in early September.

The World Bank is preparing to sell the first bond dominated in the IMF special drawing rights (SDR) unit of account, according to market sources.

The renminbi is joining the IMF special drawing rights (SDR) later this year, but that achievement does not mean mission accomplished for China’s authorities. For Beijing to achieve its stated goals of making the RMB a reserve currency and the SDR a real world currency more steps will be needed, according to leading monetary policy experts.

China is working hard to delivering on the promise of creating a multicurrency, global monetary system despite the difficulties in challenging the dollar’s status, according to an annual report by the think tank Official Monetary and Financial Institutions Forum (OMFIF) published on June 30.

The People’s Bank of China said on Tuesday it is contemplating the ‘orderly participation’ of commercial banks to trade in the offshore renminbi market. On paper, the proposed move seems to be a further opening up of its FX market. However, market participants say Beijing’s true aim is to exert greater influence on the CNH and maintain the stability of the renminbi.

The Bank for International Settlements (BIS) and the Monetary Authority of Singapore (MAS) have been investing in RMB assets ahead of the currency’s introduction into the IMF special drawing rights (SDR) basket of currency in October 2016, the two institutions said this week.

The People’s Bank of China (PBoC) is likely to issue its planned onshore bond denominated in special drawing rights (SDR) as a multi-currency structured note, according to industry participants.

There’s now only five months until the renminbi enters the IMF’s special drawing rights basket in October. But while this shows the progress the RMB has made, panelists at a recent conference are not expecting full convertibility anytime soon.

China's transition from an investment to a consumption economy is moving forward, but GDP growth concerns are likely to delay the country’s reform agenda.

China’s currency was approved to become the fifth member of the IMF’s special drawing rights (SDR) basket of currencies last November. While the new basket only becomes effecting in October 2016, China’s central bank has been campaigning worldwide for a greater role for the IMF’s unit of accounting, with the RMB set to benefit from the strategy.

Negative interest rate policies are pushing central banks to invest in emerging markets assets and currencies, according to a new survey sponsored by HSBC. The RMB, in particular, has seen a rapid growth in popularity over the past few years.

China is mulling the possibilities of issuing an SDR-denominated bond, the People’s Bank of China governor Zhou Xiaochuan said on Thursday.