The Chinese yuan's role in global trade is expanding at a rapid pace despite the hiccup caused by its surprise devaluation in August.

The yuan has displaced the Japanese yen to become the fourth- most used currency for global payments as of August, the Singapore Exchange (SGX) said yesterday, citing data from the Society for Worldwide Interbank Financial Telecommunications.

SGX's My Gateway report stated that the yuan has risen while "shrugging off a surprise revaluation to rise to its highest ranking in 2015, and boosting its prerogative for reserve status".

My Gateway is the exchange's investor education portal, offering market, product and investment information and events.

The report comes before the International Monetary Fund (IMF) conducts a "twice-a-decade" review of its Special Drawing Rights basket.

The basket, which includes the United States dollar, the euro, yen and British pound, is used by the IMF to lend money to sovereign borrowers.

Adding the yuan would make it a reserve currency, which in turn would increase its use around the world, raising China's standing in the global financial system and promoting its position as an economic power.

Standard Chartered noted that Beijing has been pushing for the yuan to be included in the basket, a move that could generate up to US$1 trillion (S$1.4 trillion) of inflows into the currency.

Beijing boosted the yuan's chances of becoming a reserve currency by launching the first phase of the China International Payment System (CIPS) in Shanghai on Oct 8.

The aim is to provide capital settlement and clearing services for cross-border yuan transactions for financial institutions in China and overseas.

The SGX report noted: "As China seeks to open its domestic foreign exchange market to overseas central banks, the CIPS will make it easier for other nations to hold yuan assets."

Trading volumes in SGX's US dollar-China Offshore Spot (USD/CNH) futures have increased "more than fourfold since its inception 12 months ago", with about 35,000 contracts worth about US$3.5 billion in all traded last month.

The report added: "This growth has propelled SGX USD/CNH futures to the forefront as the most liquid offshore yuan futures product traded across various global futures exchanges."