The RMB hit the magic 8  in May, and just keeps going up…and is now reported by People’s Daily (PD) to have reached 7.9342 to the dollar – a new record. Everyone has something to say about the RMB these days. This is the PD’s selection:
• U.S. Treasury Secretary Henry Paulson: “I am not looking for immediate solutions or quick fixes to any particular economic issue”.
• IMF Managing Director Rodrigo de Rato: “I want to really commend the Chinese authorities for the transparency on this issue (exchange rate reform)”.
For its part, China will not bow to outside pressure on currency reform, and will keep to its step-by-step approach in order to balance international pressure with domestic needs.
• Governor of the People’s Bank of China, Zhou Xiaochuan: Reform will be “gradual, effective, and controllable”…”But the direction of China’s foreign exchange regime is fixed, there will be no turning back”.
In the meantime, according to Reuters, China’s foreign currency reserves have swollen to a record US$954.5 billion, and Zhou has indicated that “sooner or later” one of the small steps will be to widen the trading band for the RMB.
I suspect we will see steps in the direction of “sooner”, and hope this will push to the background those voices in the US that are still calling for punitive tariffs on Chinese imports .
See news sources:
China sticks to its guns on yuan 
Reuters – USA
SINGAPORE, Sept 17 (Reuters) – China on Sunday brushed aside calls to take the yuan off its tight leash and said it would stick to its policy of letting the …
China talks of eventual currency shift ahead of G7 
Reuters – USA
SINGAPORE (Reuters) – China, accused by critics of keeping its currency artificially weak for economic gain, said on Friday it would ease its grip on the yuan …
RMB value against U.S. dollar hits new high