"The domestic savings rate is too high. The government is considering a new policy to spur the consumption. This will in turn boost the imports and reduce trade surplus, thus moderating both the tension on trade relations with other countries and the pressure on RMB pegging to the greenback."

These remarks were made by Zhou Xiaochuan at the International Monetary Conference in Beijing on June 7.

He said the sharp rise of exports, rather than the consumption spending, was not what they ��want to see��. He hopes the new policy would boost the consumption on the domestic market and make the trade surplus "down to the zero, if possible".

He stressed that China should expand its imports and avoid over-expansion of exports. He highlighted a "bigger role" of domestic consumption in driving the economy.

However, he recognized that the trade gap would likely widen further although China expected a balanced foreign trade.

He agrees a balanced foreign trade will ease the pressure on yuan revaluation.

By People's Daily Online