ING’s Condon Says Yuan Band Widening Is ‘Concrete Follow-Up’

Tim Condon, chief Asia economist at ING Financial Markets, comments on the widening of the yuan’s trading band by the People’s Bank of China.

“The move represents a concrete follow-up to the recent rhetorical change in the official line that the RMB exchange rate is close to an equilibrium level.

“By reducing the RMB’s attractiveness to hot money, greater two-way exchange rate risk makes possible capital account opening, which would be a logical next step.

“If so, we are in the early stage of what will be as momentous for China as WTO accession in 2001.”

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