As the yuan’s exchange rate hovers near a three-year high against the US dollar, an article by China’s top foreign exchange regulator suggests that authorities remain focused on stability and risk control.
Zhu Hexin, head of China’s State Administration of Foreign Exchange, called for “a more convenient, more open, more secure and more intelligent” foreign exchange system in the article published in the Communist Party journal Qizhi.
Regulators would seek to keep the yuan “basically stable at a reasonable equilibrium” through a framework combining macroprudential management with market supervision, according to the commentary, which was originally published on April 22, but resurfaced on other feeds in recent days.
Zhu also called for deeper capital-account opening and stronger monitoring of cross-border capital flows in the article, while pledging to improve foreign exchange hedging services to help companies manage currency risks.
The comments also came as a report by the University of Hong Kong – which was co-authored by Zhu Min, a former deputy managing director of the International Monetary Fund – found that the yuan’s share of the global foreign exchange market had significantly increased in recent years.
