Those who are counting on Peoples Bank of China (PBoC) to take steps to boost growth, should think again. Though making the economy turn is vital, PBoC is likely to pursue another agenda for the time being - its reforms.

While reforms are likely to support growth in long term and tend to be beneficial to economy, some of it may not in the very near term.

Yuan addition to International Monetary fund's (IMF), special drawing rights (SDR) basket has become Chinese government's top priority at the moment and with support of Germany, France and especially UK along with conditional support of US, it is most likely than not that Yuan will reserve its place in IMF's SDR basket. Formal inclusion will be done by end 2016......time given to China and PBoC to reform Yuan such that it meets the IMF requirement.

There are two key criteria for IMF's inclusion of Yuan in the basket......one that the currency to be important for trade around the world and second is that it is freely accessible.

First one has not been much of an issue......given China is world's largest exporter and biggest importer of commodities but the second one...Yuan is still quite far from that.

So PBoC's top most priority for this year and next would be to reform Yuan and to make it accessible. Process has already began and it is likely to intensify.....whether market likes it or not.

Anyone counting on August turmoil scenario to make PBoC - a slow moving wagon train.....would be proven very wrong.

Some of the key reforms taken up so far -

• PBoC allowed foreign central banks, sovereign wealth funds and international financial institute to access onshore bond market on a registration basis.
   
• Reform China's Renminbi fix regime - under new rule daily fix will take into account closing spot market as well as movements in other currencies.
   
• PBoC allowed foreign central banks, sovereign wealth funds and international financial institute to access onshore FX market on a registration basis.
   
• PBoC allowed domestic issuers and investors in Shanghai free trade zone to access foreign assets or to say freely convert Yuan (a pilot project).
   
• Ministry of finance will be issuing 3 month treasury bills on weekly basis to improve liquidity.
   
• PBoC adopted MF's SDSS reporting standard.