Yuan to be more responsive to market: draft paper

[tocqueville]

By Victoria Bi
1 hour, 30 minutes ago

BEIJING (Reuters) - China will press ahead with reform of its currency regime with the aim of making the yuan more responsive to market forces, according to a draft of a joint statement by China and the European Union to be issued on Monday.

The pledge by China, in a draft statement dated May 13, is due to be issued publicly on Monday, the same day that the yuan , also known as the renminbi (RMB), strengthened past 8 per dollar for the first time since the central bank revalued it by 2.1 percent and freed it from a dollar peg last July.

"China will further improve the RMB exchange rate mechanism and constantly make the exchange rate more responsive to market supply and demand," says the draft statement obtained by Reuters.

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The joint statement will be issued after a day-long financial dialogue in Beijing attended by EU Internal Market and Services Commissioner Charlie McCreevy and Chinese Finance Minister Jin Renqing.

http://news.yahoo.com/s/nm/20060515/bs_nm/economy_china_eu_dc