China tells Obama not to interfere in its currency strategy
China tells Barack Obama not to interfere in its currency strategy following speech yesterday
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China has hit back at US president Barack Obama after he said the country needed to rethink its currency policy.
Yesterday Mr Obama said China needed to adopt a "market-orientated" exchange rate policy for the yuan, which would allow it to appreciate.
But while the US claimed that China's decision to keep the currency low was to boost its exports, China said the decision was not a political one, or based on trade imbalances.
Mr Obama said yesterday: "Countries with external deficits need to save and export more. Countries with external surpluses need to boost consumption and domestic demand.
"And as I've said before, China moving to a more market-oriented exchange rate will make an essential contribution to that global rebalancing effort."
But according to reports Su Ning, vice governor of the People's Bank of China, said: "We don't agree with politicising the renminbi [yuan] exchange rate issue.
"We also don't agree with a country taking its own problems and having another country solve them."
China's ability to export more than it imports has been largely due to the low value of the yuan. Last weekend the country's central bank said it would be keeping the country's currency stable throughout 2010, with Chinese premier Wen Jiabao saying the yuan would be kept "basically stable" this year.
The two countries have experienced strained relations for a number of months, particularly over trade disputes and currency issues, as well as alleged cyber-attacks in China on US search engine Google.