China has rejected claims that the renminbi is currently undervalued, hedge funds looking at the country may be interested to discover.
China has rejected claims that the renminbi is currently undervalued, hedge funds looking at the country may be interested to discover.
Wen Jiabao, the country’s premier, stated that criticisms the country had kept its currency low in order to boost exports were unfounded.
He said: “We oppose all countries engaging in mutual finger-pointing or taking strong measures to force other nations to appreciate their currencies.”
The statement was made at a news conference yesterday at the Great Hall of the People.
While the renminbi was pegged to the dollar until 2005, it was allowed to rise independent of the US currency until 2008, when this rule was reinstated.
China attributes this move to an increased stability in an international economy threatened by the economic downturn.
Last week, China’s Consumer Price Index figures were published and showed inflation jumped 2.7 per cent year-on-year in February.
Tao Wang, a UBS economist, has predicted that the government could react to these figures by raising interest rates.
