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Xinyi Wu

Beijing has stressed that it does not intend to rely on a weaker yuan for trade gains, amid a recent rally in the currency and mounting pressure from trade partners to allow it to strengthen.
“China has neither the need nor the intention to gain competitive advantages in trade through currency depreciation,” said Pan Gongsheng, governor of the central bank, at a press conference of the country’s top economic officials on Friday.
The comments came ahead of a new round of trade talks between China and the United States in Paris next week. China’s massive export machine, a key source of bilateral trade imbalance, is usually high on the agenda of negotiations.
The US administration has previously accused China of achieving “unfair” trade advantages through currency depreciation – a claim that Beijing has long denied. Washington once labelled China a currency manipulator during President Donald Trump’s first term.
“At present, the yuan-dollar exchange rate is around the midpoint of its range in recent years,” Pan said.
The yuan has strengthened steadily against the US dollar since late last year. The PBOC set the yuan’s fixing rate at 6.9025 to the US dollar on Friday, slightly weaker than Thursday’s 6.9007, which was the strongest level in 34 months.
The yuan’s rally coincides with a softening of the dollar, which has faced downward pressure in recent months, driven by policy uncertainty under the Trump administration.
The exchange rate has emerged as a major source of friction with trading partners that have accused China of leveraging an undervalued currency to gain an unfair competitive advantage.


In a semi-annual report released in January, the US Department of the Treasury called out China’s exchange-rate policies for their “relative lack of transparency” and urged the country to allow the “substantially undervalued” yuan to appreciate.
Europe has also pressed Beijing to strengthen the yuan against the euro, particularly after China’s goods trade surplus hit a record US$1.2 trillion last year.
Last week, China’s central bank scrapped the foreign exchange risk reserve ratio for forward forex sales – previously at 20 per cent. The move, which lowers costs for banks to provide forward US dollar sales, could ease immediate demand for yuan and rein in the strengthening currency.
Pan defended the move, noting that it was “based on international rules and practices” where macroprudential management tools can be used to correct market-herding effects and negative reinforcements.
He added that financial institutions are encouraged to provide services for enterprises to manage exchange rate risks.
With a rising number of enterprises using exchange-rate hedging tools and the yuan in cross-border trade payments, more than 60 per cent of trade with China is “relatively unaffected” by exchange-rate fluctuations, Pan said.
“This proportion is expected to further increase this year,” he added.
He reiterated the central bank’s position to uphold the market’s “decisive role” in the exchange-rate mechanism, while maintaining flexibility and ensuring that the yuan remains “fundamentally stable at a reasonable and balanced level”.


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PBOC governor reaffirms yuan stability, refuting trade partners’ accusations ahead of critical US talks in Paris


PBOC governor reaffirms yuan stability, refuting trade partners’ accusations ahead of critical US talks in Paris.


China fires back at currency-depreciation claims, denies using weak yuan to boost exports

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}PBOC governor reaffirms yuan stability, refuting trade partners’ accusations ahead of critical US talks in Paris

PBOC governor reaffirms yuan stability, refuting trade partners’ accusations ahead of critical US talks in Paris