China-US Trade War: PBOC: China is not 'currency manipulator'
The US labelled China a 'currency manipulator' after the yuan fell beyond 7 per dollar. As China's currency rose again on Tuesday, the central bank was quick to say the drop had reflected a market weakened by the US tariffs. Sun Ye has more.
The central parity rate for yuan pulled up and steadied to 6.968 against the dollar Tuesday, after falling to its weakest in more than 10 years, on the China Foreign Exchange Trade System.
The Monday fall was historical, as is the US Treasury's naming China a "currency manipulator", for the first time since 1994.
China called the decision 'deeply disappointing' and the reasoning, flawed.
"The US side disregarded the facts and unreasonably labelled China a 'currency manipulator'," says a People's Bank of China statement released Tuesday. "China is resolutely opposed to this."
The same statement also says the yuan fluctuates according to the market. It explains the weakening of the yuan correctly reflects how trade tensions have rattled the currency market and the global economy. It says the US decision could mean further chaos for the global financial system. Experts share this view.
GUAN TAO ECONOMIST "The movements of the RMB exchange rate today are normal. Everyone knows that recently the United States has taken some tariff measures, which exert an impact on market confidence. In this situation which coincides with the process of increasing the elasticity of the RMB exchange rate, breaking through an integer does not really have specific economic significance."
SUN YU EXECUTIVE VICE PRESIDENT, BANK OF CHINA "The combined value of net capital inflow, whether in stocks or bonds, has neared 400 billion yuan (56.9 billion US dollars). The US dollar index has weakened over time, after seeing a period of strong movement. All these are conducive to the reasonable movement of the RMB exchange rate."