Everything just changed for China’s currency

People perform a fire dragon dance in the shower of molten iron spewing firework-like sparks to celebrate the Lantern Festival, in Meizhou, Guangdong province, March 5, 2015.

The International Monetary Fund has officially designated the Chinese yuan a global reserve currency.

That means that it joins an elite group of currencies — the dollar, the yen, the euro and the pound — in the Special Drawing Rights (SDR) basket.

This doesn’t mean that money managers around the world will suddenly shift their holdings to yuan. But this new designation does send an important message about the yuan’s importance to the rest of the world. Read more

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