Yuan set to play bigger role in global reserves, says HSBC
The number went up from a previous forecast of 6.9 percent by 2020 made in 2015.
Renminbi is seen as more attractive than a year ago by 74 percent of reserve managers in the HSBC survey, the highest among major currencies, followed by the US dollar and the euro.
The study includes 79 reserve managers worldwide, responsible for $5.5 trillion in total reserve assets, 54 percent of the world's total.
"The survey confirms the continued momentum of the renminbi. Respondents on average predicted that it will reach 8.5 percent of global reserves by 2020－which would represent a very large increase from the latest IMF published level of 1.2 percent at the end of 2017," said Christian Deseglise, global head of central banks at HSBC.
Helen Wong, HSBC's chief executive for China, said: "It is encouraging to observe the growing optimism on the renminbi among reserve managers at central banks around the world, as China steps up the opening up of its capital markets and in the process makes its currency more investment friendly.
"The recent addition of Chinese mainland-listed A shares into MSCI's Emerging Markets Index, China's policy incentives to encourage cross-border use of the Chinese currency, and the future inclusion of Chinese bonds into global indices are set to further stimulate renminbi demand from international investors."
Though positive overall, some said it will take time for many asset managers to fully embrace renminbi as one of their main reserve currencies. Issues like market breadth and corporate governance remains critical, according to the survey.
China is globalizing its capital markets gradually. Global index compiler MSCI included more than 200 China A shares in the MSCI China Index as well as relevant global and regional composite indexes, such as the MSCI Emerging Markets Index, at the close of trading on May 31.
These shares were added with a partial inclusion factor of 2.5 percent, which will increase to 5 percent during the second phase of the inclusion later this year.
The MSCI's inclusion of A shares is "a very important step in China's capital account opening-up process and a symbolic event of the capital market connectivity between China and the rest of the world", said Zhu Haibin, chief China economist and head of China equity strategy at JPMorgan.
"The inclusion factor of 5 percent will likely be extended with the further liberalization of China's capital account as well as reform and development of China's onshore financial market," Zhu said.