Yuan becomes Reserve Currency

Yuan Now Official, Yet Dollar Still Soars. Here's Why, by Larry Edelson, 12/2/15, Money and Markets

Monday morning the International Monetary Fund (IMF) admitted the Chinese yuan to its international basket of reserve currencies, which comprises the U.S. dollar, the euro, the Japanese yen, the British pound and now, the  Chinese yuan, or renminbi.

Yet, the U.S. dollar still reigns supreme and continues to appreciate in value.

So what does it all mean? Will the yuan eventually kill the dollar? To get Larry's answer and why, click here.

I’ll answer those two questions with one simple reply: There is — in no uncertain terms — no way the dollar will ever be overthrown by the Chinese yuan, or any other currency for that matter.

In fact, per Bloomberg and according to the IMF itself, the new official reserve basket will have the composition you see in the bar chart. The US dollar will remain the dominant reserve currency covering about 42% of all global trade. The Euro will be next with about 30%.  The other reserve currencies will handle about 28%.

As you can clearly see, the euro, yen and the pound will be impacted the most, not the U.S. dollar.

In fact, after official trading of the yuan as a reserve currency begins — not till Oct. 1, 2016 — the U.S dollar’s share of the IMF basket will fall from 41.90% to 41.73% …

http://www.moneyandmarkets.com/yuan-now-official-yet-dollar-still-soars-heres-74512#.Vl79mhGFMqc

Comments

Congress needs to cut federal spending and balance the budget and then begin to pay down the $20 trillion debt. The US needs to demonstrate that we will not become Zimbabwe.  This will require the GOP to take the Whitehouse and hold the House and Senate and retire about 50 Democrats and RINOs.

 Norb Leahy, Dunwoody GA Tea Party Leader