China has no intention to boost exports with yuan devaluation: Premier Li
SHANGHAI : China does not intend to use a cheaper yuan as a way to boost exports and has the tools to keep the currency stable, Chinese Premier Li Keqiang said in a meeting with the President of the European Bank for Reconstruction and Development.
"China's economy grew by around 7 percent in 2015, with the services sector accounting for half of gross domestic product (GDP). China has no intention of stimulating exports via competitive devaluation of currencies," the premier said. Li added that China is capable of keeping the yuan's exchange rate basically stable at an appropriate and balanced level.
After a nearly three percent devaluation in mid August 2015 which rattled markets, China's yuan has fallen over one percent so far in 2016, as the nation has struggled to contain capital outflows in the wake of a dramatic equity market collapse and weak economic data.
Despite recent declines, China has the world's largest foreign exchange reserves, and policymakers have repeatedly said they have the firepower to keep the yuan stable.