China's central bank on Thursday said it would increase the
"floating flexibility" of yuan, also known as renminbi or RMB,
while keeping it basically stable at a reasonable
equilibrium.
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The People's Bank of
China reiterated in a report after its quarterly monetary
policy meeting that China will continue to improve its exchange
rate mechanism.
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China should continue to implement a prudent monetary policy, it
said.
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The yuan strengthened to 8.0250 against the U.S. dollar on Monday,
the highest level since its July 21 revaluation, but weakened
marginally to 8.0296 on Friday.
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The Chinese currency has gained more than 3 percent since July last
year.
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U.S. Senators Charles Schumer and Lindsey Graham are in China to
discuss growing concerns in the U.S. Congress about China's trade
practices, currency policy and intellectual property rights.
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The visit comes as a March 31st deadline nears for the Senate to
vote on a bill written by Schumer and Graham that would impose a
27.5 percent tariff on Chinese goods. The bill is designed to
counter what the Senators call China's artificial currency exchange
rates that benefit Chinese manufacturers at the expense of American
producers.
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In response to a journalist's question on whether China would
revalue its currency, Chinese Premier Wen Jiabao said a week ago
that the "RMB now boasts the room and capacity to float up or down
on its own in line with the current mechanism and market
changes."
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(Xinhua News Agency March 24, 2006)
