Paulson visit stirs RMB revaluation talk
By Sun Min (China Daily)
Updated: 2006-09-20 09:02
Paulson met with China's central bank governor Zhou Xiaochuan at the annual
meeting of the International Monetary Fund in Singapore earlier this week.
"Of course the renminbi issue will remain one of the major interests for US
officials like Paulson and should be discussed with the Chinese side during the
visit," said Wang Yuanhong, an economist at the State Information Centre.
But going on previous communication, neither side is in a hurry to reshuffle
the renminbi exchange rate scheme. And it should be obvious to Paulson, given
his understanding of China, that a drastic appreciation of the renminbi will
bring little resolution to China's trade surplus with the United States, Wang
said.
Before he left for China, Paulson said in Singapore on Monday that moving
toward a freely traded currency is in China's interests. But, "I am not looking
for immediate solutions or quick fixes ... I am looking to set a tone and an
expectation of working through issues and making progress," he told reporters.
Zhou Xiaochuan also made it clear in Singapore that China is gradually moving
toward a flexible exchange rate regime.
The renminbi, or yuan, reached its strongest level against the US dollar
yesterday since China appreciated the currency by 2 per cent in July 2005 and
linked it to a basket of foreign currencies instead of to the US dollar alone.
The central bank set the daily reference rate for the yuan at 7.9342 when traded
against the dollar yesterday, compared to 8.11 upon last year's revaluation.
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