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Xinhua) 15:56, May 06, 2014
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Comments twitter facebook Sina Microblog reddit BEIJING, May 6 -- Two-way movements will be a normal condition for the value of theChinese currency renminbi, also known as the yuan, a monetary official said on Tuesday.
In the Shanghai Securities News, Guan Tao, head of the balance of payment departmentunder the State Administration of Foreign Exchange, said, "It is normal for the yuan toeither appreciate or depreciate."
The yuan's value has come under the spotlight as its exchange rate against the U.S. dollardeclined about 3.5 percent in the first four months of the year, a period in which thecountry also saw a shrinking trade surplus.
Guan said the depreciation was normal. "In the history of international finance, no matterwhat currency exchange rate regime is adopted, there has never been a currency onlyrising and never declining," he said.
From the launch of the yuan's exchange rate reform in 2005 to the end of last year, thecurrency has appreciated by 36 percent against the U.S. dollar, resulting in the yuan'snominal and real "effective" exchange rate rising 32 and 42 percent respectively, accordingto Guan.
It is the yuan's continuous one-way appreciation during the past two decades which hascreated a perception that the yuan would keep appreciating in the long run, he added.
The official put the yuan's recent depreciation in the wider context of China's reform of itscurrency's exchange rate formation mechanism, which aims to "keep the renminbiexchange rate basically stable at an appropriate, balanced level and expand its floatingrange."
Guan said changes in the value of the yuan was "understandable".
More signs of an economic slowdown, weak export and import figures, and news aboutcredit default cases in China in addition to the accelerated pace of a quantitative easing exitin the United States have all contributed to the increased fluctuations in the value of therenminbi, he said.
The official expected the yuan's two-way fluctuations to be a new normalcy in the futureand the currency's exchange rate to be more "flexible".
（Editor：DuMingming、Yao Chun）
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