SINGAPORE -- The Monetary Authority of Singapore (MAS) announced on June 22 that it will be including its renminbi (RMB) financial investments as part of its Official Foreign Reserves (OFR) from June 2016 onwards.
This move recognizes the steady and calibrated liberalization of China's financial markets, and the growing acceptance of RMB assets in the global portfolio of institutional investors, MAS said in a statement.
Since 2012, MAS has been making RMB financial investments through China's Qualified Foreign Institutional Investor and interbank bond market schemes. Investing in China has provided portfolio diversification benefits.
Over the past year, China has taken significant steps to liberalize access to its foreign exchange and securities markets for foreign institutional investors.
In November last year, the International Monetary Fund (IMF) announced that the RMB met the criterion of a freely usable currency and would therefore be included in the SDR basket with effect from October 1, 2016.
"The inclusion of RMB assets in MAS' OFR is timely. China's calibrated financial liberalization in the past year has encouraged growing international acceptance of the RMB," said Jacqueline Loh, MAS deputy managing director.
"An example is the set of initiatives between China and Singapore announced in November last year to further expand channels for cross-border RMB flows and support the greater use of the RMB outside China," added Loh.
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