Update | Six key things to know about the vote on China’s yuan joining the IMF basket of currencies

The International Monetary Fund’s executive board voted on Monday to include China’s yuan in its basket of international currencies.

The renminbi’s inclusion in the Special Drawing Rights, or SDR, marked a milestone in the greater use and importance of the currency around the world.

Here are six things you need to know about the Special Drawing Rights.

1. What are the Special Drawing Rights?

The Special Drawing Rights is a reserve asset created by the International Monetary Fund in 1969 as a supplement to member countries’ foreign exchange reserves and a financial instrument to offer help with liquidity to member nations facing a payment crisis. It is not a currency, nor a claim on the IMF, but it can be exchanged for freely usable currencies.

It bears an interest rate, which is set each week. The value of the SDR is currently based on a basket of four currencies - the US dollar, the euro, the British pound and the Japanese yen.

READ MORE: Beijing skittish, but market hot for Renminbi’s bid to join IMF’s SDR basket

The IMF reviews the basket’s composition every five years, including each currency’s weighting.

The weighting of the basket currencies currently are 41.9 per cent for US dollar, 37.4 per cent for the euro, 11.3 per cent for the pound and 9.4 per cent for the yen.