China will keep yuan basically stable, Premier Li says

CHINA will keep its yuan currency basically stable, which will be vital for the country’s economic and financial stability, state media on Tuesday (Jan 31) quoted Premier Li Keqiang as saying.

China will maintain its economic operations within a reasonable range, he said during a visit on Monday to the People’s Bank of China and the State Administration of Foreign Exchange.

The International Monetary Fund on Tuesday lifted China’s growth outlook for 2023 to 5.2 per cent. This is a sharp rise from the October forecast of 4.4 per cent, after harsh Covid-19 curbs in 2022 slashed China’s growth rate to 3 per cent – a pace below the global average for the first time in more than 40 years.

China has kept its foreign exchange reserves above US$3 trillion despite external shocks in recent years, reflecting the international confidence in China, Li said.

“The stability of the exchange rate is related to the overall stability of the economy and finance,” he said.

The yuan rebounded in January after falling 7.9 per cent against the US dollar in 2022, its biggest annual drop since 1994.

SEE ALSO

China posts record deficit in 2022 on Covid Zero, property slump

China’s economic activity rebounds sharply after reopening

DECODING ASIA

Navigate Asia in
a new global order

Get the insights delivered to your inbox.

China’s foreign exchange reserves – the world’s largest – rose US$11 billion to US$3.1 trillion in December.

Maintaining financial stability would be a difficult task, Li said. REUTERS