Wen talks economy, Malaysian central bank mulls RMB assets

When Wen Jiabao comes out and says China should adopt a "moderately loose" monetary policy, we have to wonder exactly what he means. After all, the People’s Bank of China said in April that it would "firmly stick" to a moderately loose policy this year, which suggests such a policy has already been adopted. Perhaps Wen’s comments are intended to reassure those worried about rampant lending and possible long-term risks to the economy. For its part, Bank Negara Malaysia, that country’s central bank, seems to have faith in China’s prospects – at least enough faith to consider including yuan-denominated assets in its foreign exchange reserves in what is a possible public relations coup for officials in Beijing seeking an eventual alternative to the US dollar as a reserve currency. One bank’s moves, of course, won’t be enough to overcome the major roadblocks to the renminbi becoming a global reserve currency, but it is a symbolic victory of sorts. There is also some symbolism to be found in Tianjin, home to the first assembled-in-China Airbus A320 passenger jet, which is scheduled for delivery on Tuesday. The factory that produced the jet is expected to produce four planes per month by 2011, with 20 A320s destined for soon-to-be-merged China Eastern Airlines.