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China had no timetable for a revaluation of its currency, People’s Bank of China Deputy Governor Guo Shuqing said.
“Foreign exchange policy (is toward) a market-based floating system...(we have) no timetable,” said Guo when asked by reporters when China would revalue the yuan.
Guo said central bank’s long-term goal for monetary policy was “sustainable growth, stable price, sound employment.”
Guo, who is also head of the State Administration of Foreign Exchange, was speaking to reporters on the sidelines of the Group of Ten meeting of central bankers from major industrialized and developing countries in Basel, Switzerland on Tuesday.
The yuan, also known as the renminbi, is pegged at about 8.28 to the U.S. dollar. China has come under heavy U.S. pressure to revalue the yuan as U.S. manufacturers say the Chinese currency is artificially cheap and this saps U.S. jobs and exports.
The Chinese Government has pledged to make the yuan more flexible through reforms, but to do so in its own time and without bowing to pressure from outside.
The yuan was also coming under upward pressure from massive inflows of foreign currency, the China Securities Journal quoted an official from the State Administration of Foreign Exchange as saying Monday.
In another development, Wei Benhua, vice director of the State Administration of Foreign Exchange, said Monday that growth in the country’s foreign exchange reserves posed challenges and the government would relax controls on capital inflows.
“Rapid, sharp growth in the size of foreign exchange reserves has triggered challenges,” the State Administration of Foreign Exchange quoted Wei as saying on its Web site.
“Under the premise of effectively controlling risk, we will selectively and gradually relax controls on cross-border capital deals to help gradually fulfil the yuan’s convertibility on the capital account,” Wei was quoted as saying.
(Shenzhen Daily November 10, 2004)
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