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SINGAPORE, Oct 18 (Reuters): It's 2015. China is Asia's largest economy, its yuan is a managed floating currency with a deep market that is on par with that of the Japanese yen.
Some of China's Asian neighbours have pegged their currencies to the yuan. Others are managing theirs against a basket of currencies, of which the yuan, yen, rupee and US dollar are chief components.
That view was outlined recently by Goldman Sachs chief economist Jim O'Neill. More and more economists are predicting similar scenarios.
It is an outlook that presages a sea change in a region where China's yuan is still as good as pegged to the dollar even after a revaluation and policy change in July, and other Asian countries are making certain their currencies do not fluctuate too much against the dollar.
But that is the direction in which Asia is headed, economists say. China's economic weight will multiply over the next few years, making it Asia's biggest in terms of output, while Japan's recovery from a decade-long slump will increase its clout in the region.
"It is a complete shift from being a dollar bloc in the aftermath of the financial crisis.
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