Central bank vows to keep yuan "basically stable"

The People's Bank of China, or the central bank, reiterated in a report issued Thursday that China will keep its currency "basically stable at a rational equilibrium" while improving the regime that determines the yuan's exchange rate.

The report acknowledged that China's monetary policy is being challenged severely by the trade surplus and rapid growth of foreign currency reserves in the first quarter of the year.

As China still implements foreign exchange controls, trade surplus will usually lead to the amassment of official foreign currency reserves, which added as much as 49.4 billion US dollars in the first three months, bringing the total to 659.1 billion dollars.

Some countries, including the United States and members of the European Union, have been claiming that the yuan is too low, giving Chinese exporters a trade advantage.

The central bank report promised to further deepen the reform on foreign exchange management and promote the balance of international payment.

The central bank has already put forward a series of policies aiming to facilitate the use of foreign currencies by domestic enterprises and individuals during the past year.

Source: Xinhua