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Premier: China to increase flexibility of RMB exchange rate

(Xinhua)
Updated: 2011-03-14 13:17
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BEIJING - Premier Wen Jiabao said Monday that China would continue to gradually increase the flexibility of its exchange rate while taking into consideration the pressure on enterprises and employment which is important to social stability.

"The appreciation of the RMB must be gradual, because it affects jobs and raises pressure on enterprises and employment, and we must maintain the overall social stability," said Wen.

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"We will continue to stick to the reform of the formation mechanism of the RMB exchange rate," Wen told a press conference after the conclusion of the annual parliamentary session.

The Chinese currency has appreciated 57.9 percent from the level of 1994, and since that year, China has conducted three major reforms on RMB's exchange rate formation mechanism, he said.

"Our reforms have aimed to adopt a market-based, managed floating exchange rate regime which is tied to a basket of foreign currencies instead of pegging to the US dollar," Wen said.

 

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