China refutes yuan depreciation claims

http://www.chinadaily.com.cn/bizchina/2009-02/18/content_7488894.htm


China refutes yuan depreciation claims
By Ding Qi (Chinadaily.com.cn)
Updated: 2009-02-18 14:55

The Chinese government on Wednesday refuted a report that it may let the renminbi depreciate due to the economic slowdown, vowing that the country will keep its exchange rate stable.

China Briefing Magazine on Tuesday cited Zhang Xiaoqiang, vice-minister of the National Development and Reform Commission (NDRC), as saying in an interview that the yuan could weaken to around 6.9 to 7 against the US dollar due to the weakening economy and rising unemployment.

But the NDRC, the country's top economic planner, said in a statement on its website on Wednesday that its officials have never made such a comment on renminbi depreciation.

The yuan fell by the most in two weeks against the dollar after the China Briefing report. One-year forwards contracts dropped by the most in more than two months.

China Briefing issued a clarification on its website on Wednesday, saying the official had acknowledged that the renminbi's position against the US dollar was currently felt to be at the correct level.

"A comment made elsewhere stating the yuan would reach 6.95/7 against the US dollar cannot be attributed to the official", the statement said. It also apologized for the confusion over the remarks, "resulting from an error in transcription and translation".

Deng Xianhong, deputy head of the State Administration of Foreign Exchange, said on Wednesday that China would keep the exchange rate of the yuan stable and prevent large fluctuations.