ranjan

China stunned the world's financial markets in August 2015 by devaluations of yuan  knocking off 3% of its value. The move was unexpected and many believed it was a desperate attempt by Chine to boost exports to support the economy which was growing at its slowest rate in decades.     There was another motive for China's decision to devalue the yuan i.e. China's determination to be included in the IMF's special drawing rights (SDR) basket of reserved currencies. The SDR is an international reserve asset that IMF members can use to purchase domestic currency in foreign exchange markets to maintain exchange rates. IMF reevaluates this currency composition in SDR basket every five years. In 2010, yuan was rejected on the basis that it was not freely usable. Later, IMF welcomed the devaluation since it was claimed of being done in the name of market-oriented reforms. Consequently yuan became part of SDR in 2016.  Within the basket, Chinese renminbi (system of currency of Ch