Friday, May 18, 2007

China Widens Daily Trading Band, Allows Yuan to Rise Faster Against Dollar

(Bloomberg) -- China widened the yuan's daily
trading limit against the U.S. dollar, allowing faster gains in
the currency to cool the economy and cut a record trade surplus
that has strained ties with the U.S. and Europe.

``Widening the band is to further improve the yuan's
mechanism, but it doesn't mean the yuan will fluctuate by a lot
or appreciate by a large magnitude,'' the People's Bank of China
said in a statement in Beijing. The yuan will be allowed to move
as much as 0.5 percent either side of a daily fixing rate
against the dollar, up from 0.3 percent, the central bank said.


Read more at Bloomberg Currencies News

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