WASHINGTON (Reuters) - If China's yuan joins the International Monetary Fund's benchmark currency basket, changes in its economy will likely be felt more deeply in Asian financial markets, a senior IMF official said on Wednesday.
Changyong Rhee, director of the IMF's Asia and Pacific Department, said estimated spillovers from China to other regional economies were already larger than expected and this could be exacerbated if the yuan, also known as the renminbi, joins the Special Drawing Rights (SDR) basket.
The IMF's executive board is due to decide in November on Beijing's bid for the yuan to have equal billing with the dollar, euro, yen and pound sterling, and Rhee stressed he did not want to pre-judge that decision.
If the currency is added, renminbi-denominated swap agreements that China has agreed with a host of trading partners could be regarded as official reserves, and general usage of the currency within the region would likely increase, he said.
"It's hard to know how fast it's going to happen but renminbi inclusion in the SDR basket can have an impact on Asian financial ... dynamics," Rhee said at an event at the Carnegie Endowment for International Peace.
Rhee said the Fund did not see a hard landing for China's economy and was more concerned about the potential impact of slower growth on other countries in the region, partly due to closer trade ties.
A one percent growth shock from China could take more than 0.3 percentage point from overall Asian growth, IMF staff calculations showed.
In the short term, China's growth rate of 6.9 percent between July and September meant the country could beat the IMF's forecast of 6.8 percent expansion in 2015, he said.
"Actually at this moment the ... overall 2015 growth rate may be close to 7 (percent) and above our 6.8 percent," he said.
(Reporting by Krista Hughes; Editing by Andrea Ricci)