Yuan Exchange Rate to Remain Steady, SAFE Head Says
Tang Shihua
DATE:  Jun 19 2024
/ SOURCE:  Yicai
Yuan Exchange Rate to Remain Steady, SAFE Head Says Yuan Exchange Rate to Remain Steady, SAFE Head Says

(Yicai) June 19 -- The yuan's exchange rate will remain at a reasonable and balanced level in the future due to the foundation and conditions of China's foreign exchange market, Zhu Hexin, director of the State Administration of Foreign Exchange, said today.

China’s economic fundamentals are more solid than before, and the resilience of the financial market is better with more experience in market response and tools for participants, Zhu said in a speech during the Lujiazui Forum which kicked off today.

The International Monetary Fund recently raised its forecast for China’s economic growth to 5 percent this year, indicating confidence in the nation's development prospects, Zhu said.

China’s forex market has shown strong resilience this year despite added external challenges. The yuan's rates against other major currencies moved up and down in a healthy manner, its corresponding rates against a basket of currencies have recently risen steadily, and the expectations for the Chinese currency have also become more stable, Zhu said.

China’s balance of payments is steady with a current account surplus and over USD3.2 trillion in foreign exchange reserves. Overseas investors’ willingness to allocate capital to yuan-denominated assets has generally improved, which along with other factors enables a stable forex market, per Zhu.

The central bank will continue to support the construction of Shanghai as an international financial center, helping the metropolis to continue to upgrade, said Zhu, who is also a deputy governor of the People's Bank of China. Shanghai’s exploration could bring more experience to the whole country, he added.

With greater determination and strength, China will unswervingly promote the high-quality opening-up of its financial market, Zhu said, adding that the nation will strive to align with high-standard international economic and trade rules, enlarge institutional opening-up, and boost in-depth reforms and high-quality economic development.

Editor: Emmi Laine

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Keywords:   SAFE,yuan,forex,China,monetary policy,rmb