Japanese Finance Minister Fukushiro Nukaga urged Chinese leaders at a meeting in Beijing to allow their currency to appreciate at a faster pace, joining calls from governments in Europe and the US.
Nukaga and five other Japanese ministers met with Chinese officials including Vice Premier Zeng Peiyan (
"I have asked China to consider letting the yuan rise at the fastest possible pace," the minister told reporters after the so-called High-Level Economic Dialogues. "The Chinese side responded that it will deal with the issue with flexibility."
European officials visiting China last week said a stronger yuan would help tame inflation that's running at the highest rate in a decade, and shrink its trade surplus. Chinese Premier Wen Jiabao (
G7 finance ministers and central bankers meeting in Washington in October singled out China, saying it should make the yuan more flexible to help resolve global trade imbalances.
The yuan has risen about 10 percent against the yen and 12 percent versus the US dollar since China scrapped a peg to the US currency in July 2005. The Chinese yuan, which is now linked to a basket of currencies, has fallen about 7 percent versus the euro.
"China should gradually move toward a free exchange rate," said Xinyi Lu (
Japan welcomes China's policy of "improving flexibility of the Chinese currency," according to a joint communique released late on Saturday in Beijing. The talks were organized in April by Japan's then prime minister Shinzo Abe and Wen.
Nukaga, who met European Central Bank (ECB) policy maker Christian Noyer in Tokyo last Tuesday, says China's strong economy and expanding trade surplus merit more yuan flexibility.
The Chinese economy, the biggest contributor to world growth, expanded 11.5 percent in the third quarter, increasing pressure for faster appreciation and higher borrowing costs to curb inflation. Consumer prices rose 6.5 percent in October from a year earlier, matching a decade high in August, a government report showed last month.
ECB President Jean-Claude Trichet said on Wednesday it is in China's interest to let its currency rise faster.
Nukaga, in addition, told Wen that he and his counterpart are likely to meet again some time in "cherry blossom season," said a Japanese foreign ministry official, who asked not to be identified. Cherry blossom typically blooms around April in Japan.
Chinese Finance Minister Xie Xuren (
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