China stands firm over exchange rate stability
By Aileen Wang and Simon Rabinovitch |
March 18, 2010, Thursday
|
Print Edition
Print Edition
CHINA "could not be any clearer" in its repeated commitment to a stable exchange rate after the United States Congress threatened to levy duties on some Chinese exports if it fails to revalue its currency.
The temperature in the dispute over China's exchange rate regime is rising quickly, with a bipartisan bill introduced on Tuesday in the US Senate that aims to get China to let the yuan rise.
Focusing on the yuan will not help solve problems in the Sino-US bilateral trade relationship, a Chinese commerce ministry official told Reuters yesterday.
"We oppose the over-emphasis on the yuan's exchange rate," the official said.
The apparent hardening of positions drove the yuan to a three-week low against the US dollar in the offshore forward market.
The Chinese official, who spoke on condition of anonymity, reiterated that the government's stance on the yuan had been consistent and was unchanged.
The official cited Premier Wen Jiabao and Commerce Minister Chen Deming, who have said that a stable yuan has contributed to both the Chinese and global economic recovery.
"We have repeated ourselves multiple times, and we cannot be any clearer," the official said.
The Senate bill reflects widespread US concern about high unemployment.
China has held the yuan at about 6.83 to the dollar since mid-2008. Rising inflation and recovering exports had fueled expectations that China was on the cusp of resuming the gradual path of appreciation followed for three years starting in mid-2005.
The Chinese commerce ministry official rejected the argument that the country's yawning trade surplus with the US and broader global economic imbalances were due to the yuan.
"Focusing on the yuan's exchange rate is not an effective way to address trade issues between China and the United States," the official said. "The yuan's exchange rate is not a magic potion for solving global economic imbalances."
The temperature in the dispute over China's exchange rate regime is rising quickly, with a bipartisan bill introduced on Tuesday in the US Senate that aims to get China to let the yuan rise.
Focusing on the yuan will not help solve problems in the Sino-US bilateral trade relationship, a Chinese commerce ministry official told Reuters yesterday.
"We oppose the over-emphasis on the yuan's exchange rate," the official said.
The apparent hardening of positions drove the yuan to a three-week low against the US dollar in the offshore forward market.
The Chinese official, who spoke on condition of anonymity, reiterated that the government's stance on the yuan had been consistent and was unchanged.
The official cited Premier Wen Jiabao and Commerce Minister Chen Deming, who have said that a stable yuan has contributed to both the Chinese and global economic recovery.
"We have repeated ourselves multiple times, and we cannot be any clearer," the official said.
The Senate bill reflects widespread US concern about high unemployment.
China has held the yuan at about 6.83 to the dollar since mid-2008. Rising inflation and recovering exports had fueled expectations that China was on the cusp of resuming the gradual path of appreciation followed for three years starting in mid-2005.
The Chinese commerce ministry official rejected the argument that the country's yawning trade surplus with the US and broader global economic imbalances were due to the yuan.
"Focusing on the yuan's exchange rate is not an effective way to address trade issues between China and the United States," the official said. "The yuan's exchange rate is not a magic potion for solving global economic imbalances."
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