China to Pledge to Keep Yuan Exchange Rate Stable
China is pledging to keep the yuan exchange rate stable after several economists stated that the recent stock market rout it threatening the financial stability of the country and might lead to currency devaluation. The yuan exchange rate with major international currencies remains stable on a bass that the government will be rational and balanced in their bid to boost confidence in the currency as the country strives to join the Special Drawing Right system of the International Monetary Fund.
Also a pledged came in an executive meeting with the State Council and China’s Cabinet that was presided over by Premier Li Keqiang as part of the policies package that is designed to encourage export and import as the world’s largest merchandiser trader will be missing its annual trade target for the fourth consecutive year. Other trade supporting measures issues will include expansion of the importation of popular consumption goods, key equipment parts, advanced technologies and introducing a pilot streamlined customs procedure nationwide along with the reduction of trade company fees.
After the meeting a statement was released saying that the conditions are good in reaching the annual economic growth goal of 7 percent and every leader have pledged to step up in their reforms for the second half of the year to boost the economy. China exports had a stronger than expected 2.1 percent year on year basis in June or $188.4 billion, but its two was trade for the first six months fell 6.9 percent or $1.88 trillion.
The figure fell below Beijing’s official target for the year for trade growth of 6 percent and when China fails to reach this year’s target this will be its fourth consecutive year that the goal has been missed. Plus a weak European economy and the depreciation of the Yen led to continuous decline in the global market will help a stable yuan to persuade the International Monetary Fund to grant reserve currency status a decision that is due to be made this year.