Economist: RMB will remain stable this year
( 2004-01-20 14:51) (Agencies)
China will keep its currency stable this year and has no plans to change the yuan's peg to the dollar, a chief economist says in Beijing.
"I feel the renminbi (RMB) still needs to be stable. Stability is beneficial. It's beneficial to Asia, to the world," said Yao Jingyuan, chief economist and spokesman for China's National Bureau of Statistics.
Asked whether the currency will definitely remain stable, Yao told reporters: "Definitely."
Pushed on whether there were plans to adjust the exchange rate, he said: "No."
He was speaking at the end of a press conference in which the bureau revealed China's gross domestic product grew by 9.1 percent in 2003.
In December, China Business Post reported that China's central bank was quietly moving ahead with a plan to peg the yuan to a basket of 10 currencies, instead of the US dollar alone.
A prospective 10 currencies would represent China's largest trade partners as well as its main sources of investment, the report said, citing sources with the People's Bank of China.
At a later phase China could eventually allow a "managed float" that would permit the currency to move within a set range, the report said.
The report gave no timetable for implementation of either phase and stressed that the potential policy change was still being studied.
China has effectively pegged the yuan at about 8.3 to one dollar since 1994 but it has come under increasing pressure, particularly from the United States, to revalue.
Washington politicians insist the yuan is substantially undervalued, contributing to a mounting Chinese trade surplus with the US and the loss of American jobs.
US Federal Reserve chairman Alan Greenspan and many independent economists have rejected those claims.
The newspaper also quoted a central bank analyst as saying that the yuan was not undervalued by 20 to 40 percent as some foreign economists maintain, with any link of the yuan to a basket of currencies likely to lead to only a modest increase in the local currency's value.
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