(Yicai Global) March 26 -- China's central bank has promised to deepen the market-oriented reform of the yuan's exchange rate as experts predict a volatile year for the recently strengthened currency.

The People's Bank of China will enhance the renminbi's flexibility and help the forex rate retain an appropriate and balanced level, it said in a statement after the monetary policy committee's first meeting since recent member changes.

The greenback started appreciating last year amid the quickly recovering Chinese economy and the global Covid-19 pandemic turmoil.

The yuan will remain stable against the US dollar in the near future even though some depreciation pressures exist due to uncertainties in the China-US relations, Li Yiju, a researcher at Bank of China's research institute, said in a recent research note.

The renminbi's forex rate will become increasingly volatile this year, said Guan Tao, BOC International China's chief global economist. Companies should be aware of that and use their hedging tools to manage the risks, Guan added.

The PBOC follows a prudent monetary policy that is flexible, precise, reasonable and appropriate, with the right timing, force and effect, according to the statement. It will maintain reasonable and adequate liquidity, and ensure that the growth of money supply and non-government financing is basically in line with nominal economic growth.

The central bank will improve its mechanism for market-oriented interest rates. It will enhance its policy interest rate system, continue to unleash the potential of reform to lower lending rates, and optimize its deposit interest rates rules.

Editors: Xu Wei, Emmi Laine, Xiao Yi