BEIJING (Reuters) - U.S. Treasury Secretary Timothy Geithner reiterated calls for China to embrace a stronger yuan on Thursday by saying a firmer currency would give Beijing more flexibility in managing future economic growth and inflation.
Geithner’s comments came after China took a milestone step last month of widening the yuan’s trading band to let the currency rise or fall 1 percent on any day from a fixed mid-point, compared with its previous plus/minus 0.5 percent.
Geithner said he welcomed Beijing’s efforts so far, adding “a stronger, more market-determined renminbi will help reinforce China’s reform objectives of moving to higher value-added production, reforming the financial system and encouraging domestic demand.
“It will provide China the independence and flexibility to respond to future changes in growth and inflation.”
Geithner, who is in Beijing with U.S. Secretary of State Hillary Clinton for annual talks that risk being overshadowed by U.S. protection of a Chinese dissident, said China needs to be more open to private domestic and foreign competition.
Reporting by Rachelle Younglai; Writing by Koh Gui Qing; Editing by Ken Wills