The International Monetary Fund's decision to include the renminbi in its reserve currency basket is a major benchmark in China's push to internationalize its currency, but it could also be a sign of decline for the currencies it is replacing.
Starting in late 2016, the renminbi will make up about 11 percent of the basket that defines the value of IMF special drawing rights — a type of reserve asset that makes up a small but symbolic portion of overall currency reserves.
The basket determines the currency mix that countries receive when the IMF disburses financial aid. The decision to add the renmimbi, also known as the yuan, will likely increase demand for the currency.
The elevation of the renminbi means that other currencies in the basket will be losing some of their share — notably the euro, which will lose 6.5 percentage points, and the pound sterling, which will lose 3.2 percentage points.