Yuan to stay stable course - even after IMF inclusion, Chinese central bank official says
Yi Gang counters speculation that currency could fall after becoming part of the special drawing rights
A top central bank official insisted on Sunday the yuan would remain stable after it became part of the International Monetary Fund’s special drawing rights, despite speculation the authorities will allow the currency to weaken after inclusion.
“Different scholars, investment banks and researchers have all sorts of predictions, and I don’t want to comment specifically on any of them,” People’s Bank of China vice-governor Yi Gang said. “The yuan will be kept basically stable at a reasonable and balanced level.”
The yuan will be kept basically stable at a reasonable and balanced level
Yi, who is also the head of the State Administration of Foreign Exchange, made the comments on the sidelines of an event celebrating the teaching career of prominent Peking University economist Li Yining. The comments came just days ahead of an IMF meeting that is expected to approve the inclusion of the yuan in the basket of currencies that defines the value of its international reserve asset, putting the yuan on par with the US dollar, the euro, the British pound and the yen.
But various institutions say a weaker yuan is on the horizon.
Read more: China’s Premier Li Keqiang plays down fears of global currency war, vows to keep yuan stable
Bank of America Merrill Lynch foreign exchange strategists Claudio Piron and Adarsh Sinha said last week that the yuan could be “deceptively stable” over the next couple of weeks before the currency weakened to 6.9 against the US dollar at the end of next year.