Yuan exchange rate at balanced level: economist (2)

The reason why China launched the exchange rate reform was partially due to large foreign exchange surplus resulted from decades of export-oriented economic policy, triggering mass input of monetary base into the market and excessive market liquidity as well as inflation pressures, said Wu.

Further, he noted that China needs to shift its growth pattern away from over-reliance on export and investment towards stronger domestic demand.

Wu made the remarks when attending the three-day International Finance Forum 2012, which started Friday in Beijing.

The Chinese currency stood at 6.2945 against the U.S. dollar on Friday, weakening 40 basis points from the previous trading day, according to the China Foreign Exchange Trading System.

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