MNI BRIEF: PBOC Aides Say Yuan Flexibility To Be Increased

The People’s Bank of China will boost flexibility of the yuan exchange rate while closely eyeing the global financial and economic situation, central bank officials told reporters on Thursday in a briefing, adding that the central bank will further facilitate the yuan’s use in cross-border trade and investment

Sun Guofeng, head of the PBOC monetary policy department, said the yuan has seen two-way volatility so far this year, and the PBoC will balance both domestic and external conditions and cope with outside changes. The central bank will help exporters and importers hedge FX exchange rate risks via reducing their costs of relevant services, Sun said.

Li Bin, head of the PBOC Macro Prudential management bureau, said the PBOC will further implement measures to increase the yuan’s use in cross-boarder trade and investment, pointing out it will guide banks to increase the use of relative products. For importers and exporters, using yuan in settlement for cross-border trade can help prevent risk from currency mismatch, so companies increasingly prefer using the yuan.