Most global investors predict China’s yuan will be convertible into other currencies by 2016, with 50 percent seeing it joining the dollar,  yen and euro as a reserve currency within a decade, a Bloomberg poll indicated. Fifty-seven percent of 1,263 Bloomberg customers surveyed who are investors, traders or analysts, including 58 percent of Asian respondents, said it’s likely the yuan will be convertible in five years.
Nineteen percent of respondents said it will become a reserve currency in that time, with an additional 31 percent predicting that step within a decade.  China’s inflation is spreading beyond food, signaling Premier Wen Jiabao’s strategy of quarter-point interest-rate increases every two months has yet to
contain consumer prices.  Clothing costs climbed 1.4 percent in April from a year earlier, the biggest gain since 1997, a statistics bureau report showed yesterday. Non-food inflation held at 2.7 percent, the fastest pace in at least six years, while overall consumer prices rose 5.3 percent. Global investors have tempered their optimism about the U.S. and world economies and plan to put more of their money in cash and less in commodities over the next six months, a Bloomberg survey found. Almost 1 in 3 of those questioned say they will hold more cash, while 30 percent intend to reduce investments in commodities, according to a quarterly Bloomberg Global Poll of 1,263 investors, analysts and traders who are Bloomberg subscribers. Both results were the highest since the survey began asking the question last June.