China rejects quick yuan revaluation

October 9, 2010 - 4:19AM
.AFP

China's top central banker has rejected demands for a quick revaluation of the yuan, saying the emerging giant will reform gradually rather then engaging in "shock therapy".

Under fierce pressure from the United States, Europe and Japan, central bank governor Zhou Xiaochuan said on Friday the yuan will move gradually toward an "equilibrium" level.

With the recovery still painfully slow in the developed world, China and other emerging markets are being asked to allow a more level playing field for trade.

Advertisement: Story continues below Attempting to defuse simmering tensions, IMF chief Dominique Strauss-Kahn said China will not be expected to revalue its currency overnight.

But earlier on Friday, US Treasury Secretary Timothy Geithner gave a glimpse of Washington's impatience with the pace of reform so far.

"The United States believes that global rebalancing is not progressing as well as needed to avoid threats to the global economic recovery," he told the IMF's 186 other member states.

Geithner added the solidarity shown in the wake of the global financial crisis is at risk of disappearing as countries like China fail to switch the foundation of their economies from foreign to domestic demand.

© 2010 AFP