The
possibility of the Yuan can move in two directions in the future after
the devaluation last week with a stable economy, said Ma Jun, Chief
Economist at the central bank of China, PBoC.
Customer
driven market price mechanism for the yuan would help avoid excessive
deviation from the equilibrium level and reduce drastically the
likelihood of sudden fluctuations. The economy is likely to grow about 7
percent this year, he said.
Yuan stopping the decline of the three-day 14th last August after his first sharp devaluation since 1994 and after the central bank said it would intervene in order to prevent excessive valuation in ascent.
Policy
makers trying to balance the need for financial stability with the
wishes of the larger exports and the inclusion of the yuan into a
reserve currency basket the International Monetary Fund (IMF).
"If
we want to evaluate the medium-term trend of the yuan, much more
important then analyzes the economic fundamentals, which have been
showing signs of stabilization and recovery," Ma said in a statement.
"Even if the central bank need to do intervention into the market in the future, it can be done in any other way," he said.
The Chinese decision August 11, then to let the broader emerging market in setting the value of the currencies it triggered massive sales in 21 years and the biggest trouble global markets.
The
exchange rate of the yuan exchange rate is now much more consistent
with economic fundamentals, and not have to make adjustments with the
export, PBoC Deputy Governor Yi Gang said in a press conference last
August 13. The Central Bank of its intervention was out of the ordinary,
and would act if excessive market volatility, said Yi. https://www.mql5.com/en/signals/120434
