China rules out weakening yuan to boost trade

SHANGHAI -- China's central bank chief promised Friday to avoid weakening its yuan to boost sagging exports as he tried to reassure nervous financial markets about his government's handling of its economy and currency at the start of a closely watched gathering of global finance officials.

See Full Article

Beijing wanted to use the gathering of finance ministers and central bankers from the Group of 20 rich and developing countries to promote its campaign for a bigger voice in managing global trade and finance. Instead, the communist government is scrambling to defend its reputation for economic competence after a spate of stock market and currency turmoil.

A key worry, despite repeated Chinese denials, is that Beijing will allow its yuan to decline in value to support struggling exporters. That expectation has driven an outflow of capital from China that spiked to a record $135 billion in December.

"We will not resort to competitive depreciation to boost our advantage in exports," said Zhou Xiaochuan, governor of the People's Bank of China, at a news conference.

Zhou said the meeting of finance officials from the United States, Japan, Europe and other major economies should focus instead on managing lacklustre global demand, structural economic reforms and promoting "sustainable and balanced" growth.

Other officials attending the meeting include U.S. Treasury Secretary Jacob Lew and Federal Reserve Chairwoman Janet Yellen; China's finance minister, Lou Jiwei, and their counterparts from Germany, Britain, Japan, South Korea, India and South Africa.

Economists complain the secretive Chinese government has fueled market volatility by failing to communicate policy changes clearly.

In a report ahead of the Shanghai meeting, the IMF urged G-20 leaders to support China's economic reforms but also called on Beijing to "ensure clear communication of their exchange rate policies."

Other governments have tried to reassure markets their governments have the means to combat an economic slowdown. They also are trying to douse expectations the Shanghai meeting will produce specific growth plans similar to the ones rolled out in 2009 in response to the global crisis.

Lew said in an interview broadcast Wednesday by Bloomberg Television that the meeting would likely produce "a more stable understanding of what the future may look like," including greater clarity from Beijing about its plans.

However, Lew said he did not expect the discussions to produce specific plans of "what each country is going to do and how."



Advertisements

Latest Economic News

  • Transat shares surge after positively revising summer earnings outlook

    Economic CBC News
    Shares of Transat A.T. surged on Monday to the highest level since early 2015 after the travel company signalled that it is having a significantly more profitable summer season than it had expected. The Montreal-based company's shares rose as high as $8.85 on Monday before easing back to $8.70 in intraday trading on the Toronto Stock Exchange, up 74 cents from Friday's close. Source
  • Losing PC Financial may give Loblaw the chance to merge PC Points with Shoppers Optimum, analyst says

    Economic CBC News
    Another divorce in Canada's loyalty card sector has consumers stuck in the middle asking questions about the future of an industry still bruised by the actions of some of its largest providers. The Canadian Imperial Bank of Commerce announced last week it is severing ties with Loblaw's President's Choice Financial and rolling PC's two million bank accounts into its Simplii Financial brand starting Nov. Source
  • CIBC divorce from PC Financial shines light on bruised loyalty card industry

    Economic CTV News
    MONTREAL -- Another divorce in Canada's loyalty card sector has consumers stuck in the middle asking questions about the future of an industry still bruised by the actions of some of its largest providers. The Canadian Imperial Bank of Commerce announced this week it is severing ties with Loblaw's (TSX:L) President's Choice Financial and rolling PC's two million bank accounts into its Simplii Financial brand starting Nov. Source
  • Ontario to move ahead with road access into chromite-rich Ring of Fire region

    Economic CTV News
    THUNDER BAY, Ont. -- Premier Kathleen Wynne says Ontario is moving ahead with building roads into the Ring of Fire region. The provincial government has been talking with the chiefs of the Matawa First Nations for years, since it pledged $1 billion in 2014 to fund infrastructure into the chromite-rich area. Source
  • Toronto stock index down slightly, as Canadian dollar strengthens

    Economic CTV News
    TORONTO - The Toronto stock market fell slightly this morning, but held onto its value better than the major American indexes. The S&P/TSX composite index was down 2.38 points to 14,949.95, after 90 minutes of trading. Source
  • Airlines rush to capitalize on eclipse interest with special flights

    Economic CBC News
    Airlines across America were rushing to cash in on the flurry of interest from sky-watchers for a first class seat to Monday's once in a lifetime solar event. Southwest Airlines was touting five special flights targeting sky-watchers eager to get an out of this world view of the solar eclipse set to pass over the United States on Monday. Source
  • China's Great Wall considers bid for Fiat Chrysler Jeep unit

    Economic CBC News
    Chinese SUV maker Great Wall Motors is considering making a bid to buy Fiat Chrysler's Jeep unit, spokespeople for the company said Monday, in a possible ambitious new step onto the global stage for China's fast-growing auto brands. Source
  • Wholesale trade declines in June after 8 months of gains

    Economic CBC News
    Wholesale trade slipped to $61.4 billion in June, Statistics Canada reported Monday, ending an eight-month streak of expanding sales. Sales in the food, beverage and tobacco industries led the way lower, down 1.1 per cent from May's level to $10.78 billion. Source
  • Wholesale sales dip slightly in June, first decline in months: StatsCan

    Economic CTV News
    OTTAWA -- Canada's wholesale sales declined slightly in June, with the food and auto industries showing the biggest impact. Wholesale sales fell by 0.5 per cent to $61.4 billion, following a series of monthly increases. Source
  • Transat offers sunny Q3 outlook after good start to summer travel season

    Economic CTV News
    MONTREAL -- Transat A.T. Inc. says it's having a better summer season than expected and its third-quarter results will show "significantly higher" adjusted earnings than during the comparable period last year. The Montreal-based travel company says revenue has been higher than anticipated since mid-June when Transat issued its previous outlook and second-quarter results. Source