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Governor: Yuan peg reform 'a slow business'
(Agencies)
Updated: 2005-05-25 14:52
China's exchange rate reform is a "slow business," the nation's central bank
governor said, in another signal that Beijing is not prepared to bow to foreign
pressure on its currency.
China's exchange
rate reform is a 'slow business', central bank head Zhou Xiaochuan said on
May 24, 2005. [AFP] | "It's impossible that
there'll be news in just one or two days," Zhou Xiaochuan said according to the
state-run China Securities Journal. "Reform of the yuan exchange rate is a 'slow
business'."
Zhou made the remarks at a forum in Beijing Tuesday as China remained under
heavy criticism globally for sticking to an exchange rate that is seen as giving
its exporters an unfair advantage.
The Chinese yuan has been pegged at around 8.28 to the US dollar for the past
decade and has followed the American unit as it has fallen in value against
major currencies such as the euro and the Japanese yen.
European Central Bank President Jean-Claude Trichet said Monday that several
Asian currencies, and the Chinese yuan in particular, were undervalued compared
to the euro and the dollar.
Zhou was also quoted in Wednesday's report as saying that any decision to
adjust interest rates "depends on the country's inflation figures."
State media reported earlier this month that the central bank might further
raise interest rates given the strong growth in China's April industrial
ex-factory prices which indicated investment demand was still strong.
China's industrial ex-factory prices rose 5.8 percent year-on-year in April,
0.2 percentage points higher than the rate posted in both March and the first
three months.
In October, China raised the lending rate in the local currency for the first
time in nine years and in the months that have followed speculation has
persisted about the need for further rate hikes.
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