China forex chief says no intention of competitive currency devaluation

China has no intention and no need to carry out competitive currency devaluations, the head of the foreign exchange regulator said.

Pan Gongsheng, head of the State Administration of Foreign Exchange. [File Photo: CGTN]

In a weekend piece in Chinese magazine Modern Bankers, Pan Gongsheng said the central bank's supplying of liquidity to the market was to prevent excessive fluctuations of the exchange rate and prevent a "herd effect", to maintain market stability.

"China has no intention of raising competitiveness via currency devaluation. It does not have this wish, and it also does not have this need," Pan wrote.

China was working hard to raise the exchange rate's flexibility and to maintain its stability, he added.

This was good for the international community and would avoid negative spillover effects from a disorderly exchange rate adjustment or competitive devaluations by other currencies, Pan wrote.

Pan is also a vice governor of the central bank, the People's Bank of China.

China's Renminbi is up just around 0.7 percent so far this year, having lost nearly 7 percent in 2016. 

Despite harsh rhetoric about China on the campaign trail, Trump has recently had warm words for his Chinese counterpart Xi Jinping, praising him for trying to rein in nuclear-armed DPRK.

Trump has also backtracked on his pledges as a candidate to label China a "currency manipulator" and impose steep tariffs on Chinese imports.

(Source: Reuters)