China Brushes Off Calls to Revalue Currency

February 23, 2006 – China has brushed off increased U.S. pressure to strengthen the yuan, saying they would not make any drastic moves to further revalue their currency.

“We will perfect the managed floating exchange rate system based on China’s needs for economic and financial development and stability,” The People’s Bank of China said in a statement.

China’s currency, undervalued by up to 40 percent, has let to a substantial loss of manufacturing jobs and surging trade deficit. China revalued the yuan by mere 2 percent last year, but have since done nothing to further revalue their currency.

China’s refusal to further revalue their currency is leading lawmakers to renew efforts to pass legislation punishing China’s unfair trade practices.

Read the Financial Times article on MSN Money.