WASHINGTON - The Chinese yuan's share of currency reserves increased to 1.89 percent in the fourth quarter of 2018, ranking the fifth among all allocated reserves, the International Monetary Fund (IMF) said Friday.

Reserves held in Chinese yuan, or renminbi (RMB), rose to $202.79 billion, according to the IMF's newly released data on currency composition of official foreign exchange reserves.

Yuan's share of currency reserves in the fourth quarter reached the highest since the IMF began releasing yuan's data in late 2016, exceeding that of Canadian and Australian dollars, which was 1.84 percent and 1.62 percent respectively.

Analysts believe that the RMB's growing share in the foreign exchange reserves of the world's central banks reflects an uptick in interest in holding RMB assets after the RMB was included in the IMF's Special Drawing Rights (SDR) basket in November 2016.

It is also driven by the need to reduce reliance on the US dollar and promote diversification of foreign exchange reserve assets.

The IMF data showed total allocated reserves increased to $10.73 trillion in the fourth quarter of 2018.

Reserves held in the US dollar fell to $6.62 trillion, and the US dollar's share, still the largest, dropped for the third straight quarter, reaching 61.69 percent of allocated reserves.

Reserves held in the euro rose to $2.22 trillion, and its share, still the second, increased to 20.69 percent, the highest since the fourth quarter of 2014.

The share of the Japanese yen and pounds sterling ranked the third and fourth respectively.