Inclusion of RMB in IMF currency basket a mixed blessing for China

Tokyo

CHINA'S renminbi (RMB) is set to take its place alongside an elite set of currencies that form the IMF's quasi international reserve currency known as Special Drawing Rights or SDRs. But some experts say the timing of the move may create problems for a Chinese economy that is slowing rapidly.

Following Friday's announcement by managing director Christine Lagarde that International Monetary Fund staff have determined the RMB to be "freely usable", it is almost certain the IMF Board will agree on Nov 30 to include the currency alongside the US dollar, euro, yen and pound in the SDR basket.

The SDR is not an official reserve currency but SDRs are allocated to IMF member countries and they can be exchanged for "hard" currencies in the SDR basket in the event of emergencies. Some economists see the SDR…