China's yuan: Asia's future anchor currency?

In a commentary on the yuan rising to become one of Asia’s lead currencies, SMU Professor of Economics and Statistics (Practice) Chow Hwee Kwan wrote about how Singapore’s role as an international financial centre based in Asia has played a key role in enabling it to be a regional gateway for the currency, and how China has taken other pro-active steps to broaden the international use of its currency since 2009, such as allowing offshore banks and central banks to invest in China's interbank bond market. Prof Chow also opined that given China’s economic and political dominance in the region, it is not likely that the yuan will become Asia's only anchor currency, as Asia’s geographically diversified trade patterns meant that Asian currencies are more likely to benchmark against more than one currency.

 

Source
The Straits Times