Federal Reserve Chairman Yi Gang wants to facilitate lending, supporting China’s flagging economy. He rejects the accusation of manipulating the currency.
China’s central bank has pledged further support measures for the weakening Chinese economy. On the sidelines of the People’s Congress in Beijing, Fed Chairman Yi Gang said on Sunday that the central bank still sees scope for pressure under the global economy. For example, it could lower the capital buffers for banks – but not as much as before. In order to boost lending to smaller companies, the central bank had eased its requirements five times in the past year alone.
At the start of the annual convention of the People’s Congress, China’s government had already announced billions in tax cuts and investments against the approaching economic slowdown. China’s fiscal policy will become more vigorous, said Prime Minister Li Keqiang. The growth target for 2019 is only 6.0 to 6.5 percent. Last year, the world’s second largest economy grew by 6.6 percent, the lowest rate since 1990.
At the same time, Yi Gang affirmed China’s promise not to manipulate the yuan’s exchange rate against the US dollar. In the US, there are repeated allegations that China is weakening its currency in order to promote its exports. In the opinion of experts, Beijing is endeavoring to ensure that the yuan does not depreciate even faster.
Yi Gang said on Sunday that the exchange rate has also been the subject of recent discussions to settle the US-China customs dispute. „We emphasize that we will never use the exchange rate for competitive goals, nor will we use it to boost China’s exports,“ Yi said. „Our two countries have reached consensus on important issues,“ the central bank chief said, without giving details.. On the sidelines of the People’s Congress in Beijing, Fed Chairman Yi Gang said on Sunday that the central bank still sees scope for pressure under the global economy. For example, it could lower the capital buffers for banks – but not as much as before. In order to boost lending to smaller companies, the central bank had eased its requirements five times in the past year alone.
At the start of the annual convention of the People’s Congress, China’s government had already announced billions in tax cuts and investments against the approaching economic slowdown. China’s fiscal policy will become more vigorous, said Prime Minister Li Keqiang. The growth target for 2019 is only 6.0 to 6.5 percent. Last year, the world’s second largest economy grew by 6.6 percent, the lowest rate since 1990.
At the same time, Yi Gang affirmed China’s promise not to manipulate the yuan’s exchange rate against the US dollar. In the US, there are repeated allegations that China is weakening its currency in order to promote its exports. In the opinion of experts, Beijing is endeavoring to ensure that the yuan does not depreciate even faster.
Yi Gang said on Sunday that the exchange rate has also been the subject of recent discussions to settle the US-China customs dispute. „We emphasize that we will never use the exchange rate for competitive goals, nor will we use it to boost China’s exports,“ Yi said. „Our two countries have reached consensus on important issues,“ the central bank chief said, without giving details.
