China rejects RMB revaluation calls

Recent US calls for a further revaluation of the yuan have been rejected by the People's Bank of China in its quarterly survey of the economy in which it outlined plans to keep the currency basically stable. The announcement of a record US$725 billion US trade deficit and President Hu Jintao's scheduled visit to Washington in April have prompted renewed pressure from the US for further currency flexibility. Beijing introduced a 2.1% revaluation last July as the yuan's dollar peg was dropped in favor of a managed float. But it wants to progress slowly, fearing the impact a rush of reform may have on domestic enterprises with little experience of managing currency risk.