Profile of China’s Forex Chief – says the yuan’s exchange rate is approaching an equilibrium level

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People’s Bank of China Deputy Governor Yi Gang also holds the position as administrator of the State Administration of Foreign Exchange (SAFE). There is an interesting interview with him in Caixin Online (Caixin is a Beijing-based media group providing financial and business news and information).

  • Says his latest priority is to curb growth of China’s foreign reserves, he wants to put the reserves to work through efficient investment
  • SAFE has thus launched an investment agency called China Reform Holdings Corp. Ltd. and opened an office to coordinate forex reserves-related loan activities
  • Yi also discusses China’s effort to balance international payments
  • Also reform the process by which authorities adjust the yuan-foreign currency exchange rate.

Yi says the yuan’s exchange rate is approaching an equilibrium level “which means attention has shifted from the Chinese currency’s appreciation to the government’s interest in building a market-driven rate-adjustment system that is flexible and requires little if any central bank intervention”

The interview is here:

Yi Gang: China’s Forward-Thinking Forex Chief
A leading monetary policymaker says China should cap forex reserves and marketize the yuan’s exchange rate

 

Also:

Opening the capital account via a “convertible currency” is another financial reform issue that’s attracted considerable attention and more than average controversy. The government first announced plans for a free-floating yuan 17 years ago, but so far there has been no breakthrough. The next step, he said, will have to be guided by the market.

Author: Eamonn Sheridan

Eamonn Sheridan worked with Bankers Trust Australia for 13 years as a Spot foreign exchange dealer, trading across all major currencies and all time zones. He rose to a Vice President position, running spot operations during the busy European time, leaving the bank just prior to it being sold to concentrate on running his own business in the ‘real world’! The markets, however, had him hooked – he continued to trade equities, CFDs and then on to futures, giving him broad experience across financial markets. He is now active in FX and equity index futures as well as writing for ForexLive™. Eamonn is a graduate of The University of Melbourne in Australia and lives in New South Wales.

2013-12-05T07:34:07+0000

All|Asia Pacific|Central Banks|Exotic Currencies|People's Bank of China

PBOC|People's Bank of China|SAFE|State Administration of Foreign Exchange|Yi Gang

Eamonn Sheridan

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