Jan 25, 2009, 2:32 GMT
Beijing - China's central bank
rejected allegations by a senior US official that China is manipulatingthe exchange rates of its currency, state-run media reported Sunday.
Su Ning, vice governor of the People's Bank of China, said theallegation could sidetrack efforts to track the real cause of thefinancial crisis, Xinhua news agency reported.
'Also, weshould avoid any excuse that might lead to the revitalization of tradeprotectionism. Because it will do no good to the fight against thecrisis, nor will it help the healthy and stable development of theglobal economy,' Su said.
US Treasury Secretary-designate Timothy Geithner made the charge to the Senate FinanceCommittee last week. 'President Obama, backed by the conclusions of abroad range of economists, believes that China is manipulating itscurrency,' he wrote, in documents released Thursday.
YiXianrong, a researcher with the financial research center of the CASS,told Xinhua on Friday if the US labeled China a 'currency manipulator',it would hurt the concerted action of fighting the global financialcrisis.
It would also hamper the global efforts to shakeoff an economic slowdown as Sino-US economic ties had become among theworld's most important relationships, Yi said.
According to China customs statistics, Sino-US trade hit 333.74 billion dollars in 2008, up 10.5 percent year on year.
With a 9-per cent growth rate, China contributed more than 20percent of global economic growth in 2008, while the US remained theworld's largest economy, Yi said.
Geithner's comments wereaimed at testing the Chinese government's response, Zuo Xiaolei, senioranalyst with the Beijing-based Galaxy Securities, told Xinhua.
Yuan appreciation and the pace of appreciation should not only bedecided by trade surplus but also the status of domestic economicdevelopment, Zuo said.
'The price advantage of Chineseexports may not be a result of currency issues, but the country's lowercosts of labor, resources and land,' she said.
In July2005, China abandoned a decade-old peg to the US dollar and allowed itscurrency to appreciate by 2.1 percent. Since then, the yuan hasstrengthened further, rising more than 20 percent against thegreenback.