BOA’s Lu Ting Says Widening Yuan Band Is Step to New FX Regime
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Lu Ting, an economist at Bank of America Corp., comments on the widening of the yuan’s trading band by the People’s Bank of China.
“Widening the band to 1% is an important step towards a rule-based FX regime with a trade-weighted basket as the new anchor.” The People’s Bank is under pressure to build such a regime to avoid having to again peg the yuan to the dollar once it views the currency as no longer undervalued, Lu said.