CHINA HINTS AT READINESS TO LET YUAN RISE
Treasury Secretary, Mr. Timothy Geithner will hold talks in Beijing on Thursday against a background of fresh signals from Chinese policymakers that they might be paving the way to let the yuan resume its rise, Reuters reported on Wednesday.
The National Development and Reform Commission, the nation's top economic planner, said China would monitor exchange rate risks facing exporters, while an economist from the agency said Beijing should edge toward a more flexible yuan.
'We should keep the yuan basically stable at a balanced and reasonable level, while strengthening analysis and monitoring and making announcements about risks in a timely manner to reduce exporters' risks and losses,' the NDRC said in a policy overview issued on the central government's website, www.gov.cn.
The statement suggested policymakers are weighing what may happen if they let the yuan recommence its climb after keeping it yoked to the dollar since mid-2008.
On Wednesday China's central bank set the yuan's mid-point at 6.8259 per dollar, the strongest for the yuan in 10 months.
Dealers have been rushing to buy Asian currencies that may strengthen as well if China lets the yuan appreciate against the dollar. For example, the dollar fell to a near 23-month low of 3.1930 Malaysian ringgit on Wednesday.
The yuan would presumably be at the top of Geithner's agenda when he meets Chinese Vice Premier, Mr. Wang Qishan on Thursday on his way home from financial partnership talks in India.
A United States Treasury spokesman, accompanying Geithner in Mumbai, declined to talk about the subject matter of the meeting and said there would be no further statements about it.