(Yicai Global) Oct. 19 -- The current yuan exchange rate seldom limits changes in supply and demand, as the rate itself shows, and expanding the floating range of the rate is thus not a current focus, People's Bank of China (PBOC) Governor Zhou Xiaochuan said.
He made these comments today at the 19th Communist Party of China (CPC) National Congress.
A floating exchange rate depends more on supply and demand, he stated. A long-route remains to traverse before the yuan becomes a freely-convertible currency, though remarkable progress has come in this respect.
A floating exchange rate is thus of slight consequence and the current range seldom limits changes in supply and demand, anyway, as the rate itself shows. Expanding the range would also send the signal that exchange rate reform will occur at some point, but this is not a current priority.
Addressing the issue of whether opening-up includes free market access -- as in the case of the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect and Bond Connect -- Zhou noted that this rubric also encompasses open financial market access.