China Foreign Ministry spokesman Geng Shuang said in a regular press briefing today that “China does not intend to stimulate exports through the currency competitive devaluation” and added that’s China’s consistent position. He went further to emphasize that the “RMB exchange rate is mainly determined by the market supply and demand.” And for now, “China’s economic fundamentals continue to improve, providing strong support for the RMB exchange rate to remain basically stable.”
However, Geng didn’t directly say China has not intervene in the markets. It’s suspected that a state own-bank has stepped in last Friday selling US Dollar to halt the decline of the yuan when USD/CNY (on shore yuan) breached the government’s red line of 6.8. US Treasury Steven Mnuchin said last Friday that the US will monitor if China has manipulate the Yuan exchange rate. Mnuchin has to deliver his promise and come out to warn China for not intervening in the markets again, and just let Yuan falls against Dollar, if he didn’t lie.
