14 Apr 2010

China resists US overture on yuan

6:07 am on 14 April 2010

Chinese President Hu Jintao has resisted pressure from President Obama to raise the value of the yuan.

The Xinhua official news agency reported that he told Mr Obama that it would "neither balance Sino-US trade nor solve the [US] unemployment problem".

However, Mr Hu indicated that the Chinese were preparing to change their policy on the yuan in their own time.

According to Xinhua, Mr Hu said that detailed measures for reform should be considered in the context of the world's economic situation, as well as China's.

China News Service reported that Mr Hu said China "is firmly committed to the direction of reforming the... exchange rate regime. This is based on the needs of China's own economic development."

However, he added that "outside pressures will not advance [reform]".

The BBC reports China has pegged its currency to the dollar since 2008 in response to market volatility during and after the financial crisis. Market reaction to the comments was fairly muted.

The Chinese and US presidents were meeting at the sidelines of a summit in Washington DC.