Bali: China’s central bank, The People’s Bank of China, hopes to keep the yuan’s exchange rate stable, assistant governor Ma Delun said.
“The People’s Bank of China’s foreign exchange goal is to preserve the stability of the renminbi,” Ma said in a speech at a conference in Bali, Indonesia on Thursday, using the official name of the Chinese currency, otherwise known as the yuan.
The regulator wants “gradual, controlled,” currency reforms, he said.
The yuan rose the most in almost two weeks on Thursday, to the highest since the end of a peg to the US in July 2005. US and European officials have urged China to let the yuan gain more rapidly to curb record trade surpluses that have flooded the world’s fastest growing major economy with cash and complicated government efforts to cool investment and inflation.
Tough talk: Bank of China assistant governor Ma Delun. He says China’s trade surplus is a problem.
China’s economy is “too reliant” on investment and the trade surplus is a “problem,” Ma said.
The government is trying to encourage consumer spending to reduce the economy’s dependence on exports and investment for growth.
Savings in China are too high and farmers’ income and spending still are too low, Ma said, adding that the government hopes to keep unemployment below 4%.
The yuan climbed 0.24% to 7.42 against the dollar in Shanghai, according to the China Foreign Exchange Trade System.
The currency has risen about 11.5% since the fixed exchange rate was dropped.
Ma said the US dollar has the highest weighting in the nation’s foreign exchange reserves.