Anna 
China has announced plans to adjust the weightings of its key yuan index basket in 2024, according to a statement from the China Foreign Exchange Trade System (CFETS) on Friday.
Effective from January 1, the CFETS, overseen by the central bank, will implement changes to the currency basket. The U.S. dollar’s weighting in the CFETS currency basket will be lowered to 19.46% from its current level of 19.83%. Additionally, the euro’s weighting will see a reduction to 18.08% from 18.21%.
This move reflects China’s ongoing efforts to manage and optimize the composition of its currency basket, aligning with developments in global foreign exchange markets. Adjusting the weightings aims to maintain a balanced representation of major currencies within the basket, ensuring its relevance and responsiveness to changing market dynamics.
The decision comes as part of China’s broader strategy to enhance the role of the yuan on the global stage and foster a more diversified and stable international monetary system. The yuan’s weight in the Special Drawing Rights (SDR) basket of the International Monetary Fund (IMF) has steadily increased over the years, underlining China’s commitment to promoting the internationalization of its currency.
