The U.S. Government today welcomed the announcement with caution that China will expand the yuan’s fluctuation band against the dollar to 1%, compared to up to 0.5% effective so far.
“Over recent years we have pressed the Chinese to take additional steps to appreciate its currency,” he told reporters in Cartagena (Colombia), the deputy national security adviser in the White House, Ben Rhodes.
China has made “some progress” but “would like to see more movement,” noted Rhodes, accompanying U.S. President Barack Obama, in Cartagena, where he is holding the Sixth Summit of the Americas.
“We have taken note of the announcement, we are reviewing closely,” said Rhodes.
The People’s Bank of China (issuer) on Saturday announced the decision, which will be effective from Monday and justified in the “development of China’s foreign exchange market and capacity-building pricing and risk management market players. ”
The announcement comes a month after the governor of the bank, Zhou Xiaochuan, the Asian country to observe that it was considering expanding “appropriate” margin of fluctuation of the yuan, an undervalued currency in the opinion of the main trading partners second world economy.
Unlike most of the world major currencies, whose value is set according to supply and demand, in the case of China is the People’s Bank of China established the daily rate of the yuan.
Obama has repeatedly criticized in China because it believes that this country remains low the yuan artificially, which benefits their exports at the expense of Americans.