Trading in narrow range expected

By Cathy Ding  |   2009-6-29  |     NEWSPAPER EDITION

THE yuan is seen to trade within a narrow range against the United States dollar because China will maintain its loose monetary policy.

The Chinese currency was basically unchanged against the greenback last week and closed at 6.8328 last Friday, according to the China Foreign Exchange Trade System. The yuan ended at 6.8338 at the end of the previous week.

The People's Bank of China reiterated that it will keep its relatively loose monetary policy. The monetary policy committee of the central bank said in a press release last Thursday that it will also monitor that new loans increase at a reasonable pace.

The industrial profits of Chinese firms fell 22.9 percent in the first five months, the National Bureau of Statistics said last Friday.

"China's exports will not recover soon and the yuan may trade between 6.80 and 6.85 against the US dollar over the next 12 months," said Shi Lei, a Bank of China analyst.