China will maintain a relatively stable yuan exchange rate and avoid sharp fluctuations, said governor of China's central bank Zhou Xiaochuan in a recent interview, according to the official China Securities Journal.
Currency exchange rates are a reflection of market supply and demand and international payment balances, Zhou noted, adding that the current global financial crisis is now "a major factor" for China when deciding its exchange rate policy.
Zhou reiterated that the central bank will "keep the relative stability of yuan at a reasonable and balanced level". But he also said that with the ongoing global financial crisis the government now may have different considerations in policy-making compared with normal times.
"Based on the economic data from last December, the government's stimulus policies have seen some preliminary effects," Zhou said.
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(China.org.cn by Yan Pei, February 5, 2009)