The Yuan’s Rate of Exchange Will Retain Its Basic Stability – China’s Central Bank

China’s Central Bank, popularly known as the People’s Bank of China has issued a statement concerning the rate of exchange of the Yuan currency through its vice governor, Liu Guo-qiang. He said that their goal is to retain the basic stability of the rate of exchange of China’s currency – the Yuan and the Renminbi.
So far the rate of exchange of the Yuan has been kept at a consistent and stable level, and now the PBOC has announced that it intends to keep it that way.

There had been some statements from some officials of the PBOC that the Government should let the currency be naturally influenced by the market and it should appreciate on its own.

Liu Guo-qiang says that in the future, the international market’s demand and supply will determine the exchange rate of the currency, but he intends to keep the currency rates at a basic and stable level. He also added that there are plans to have a judicious money policy that will be purposeful, suitable, and flexible enough to accommodate needs.
In a separate interview, the PBOC’s director for financial research stated that if the Yuan is to be accepted and used worldwide, then the China Government has to stop influencing its rate of exchange. He also reiterated that the Government has seen the same reasons and has promised to reduce its interference in the exchange rate, and will instead allow the market to play its natural role in determining it.

This event comes at the back of a claim that China had launched its digital currency to replace the U.S. dollar for currency for payments and international reserve. PBOC’s former governor, Zhou Xiaochuan, refuted those claims and stated that the e-currency was mainly for meeting the needs of online transactions and for retail commercial activities. Both the e-currency and the currency notes are to have the same valuation and exchange rates.

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