BEIJING -- China's renminbi hit its highest level in nearly three weeks against the US dollar on Wednesday, mainly driven by market forces, according to analysts. They said they expected no change in its flexible floating.
The currency's central parity — the daily trading reference around which its exchange rate can float up or down by 2 percent — strengthened to 6.8271 per dollar on Wednesday, rebounding for a fourth consecutive trading day, the highest level since Aug 2.
Experts said the rising yuan has been mainly driven by market factors as the market is playing a decisive role.
"The (Chinese) central bank has pushed forward the market-oriented reform of the exchange rate regime at a special time, which was brave," said Ding Zhijie, vice-president of the University of International Business and Economics in Beijing, referring to Sino-US trade tensions. "And the result so far showed it's successful."
Along with reform, the market will have more say in the country's exchange rate regime, he said. "It will be normal to see the renminbi floating either up or down in the future."
Central bank officials reaffirmed at a news conference on Tuesday that China will not use the foreign exchange rate as a tool to cope with trade friction, meaning the monetary authority will not make moves to devaluate the renminbi.
The central bank stated in its latest monetary policy report that it may take additional measures to hedge against exchange rate risks and to minimize the negative impacts from foreign exchange market fluctuations.
The report also said that the central bank has paid close attention to recent cross-border capital flows. (Source: Chinadaily)
A single purchase
