People's Bank of China: Will Not Use Currency Depreciation to Gain Trade Advantages
nashnova research
The People's Bank of China stated it will not pursue competitive currency devaluation, attributing China's trade competitiveness to industrial upgrading rather than exchange-rate tools, and dismissing external claims that the yuan is officially undervalued.
What exactly did the PBOC say?
The central bank's core position in one line: China has no need and no intention to gain trade advantage through yuan depreciation.
This means → Beijing frames its trade surplus as a product of rising industrial competitiveness, not a cheap currency.
In plain terms = the PBOC is saying: "We sell well because our products are strong, not because we're keeping the yuan artificially low."
Why push back on the "undervalued yuan" claim?
Some external bodies have used model-based assessments to argue the yuan is undervalued, citing the results as evidence of currency manipulation.
The PBOC responded that international assessment methods remain immature, and treating any single estimate as an "official basis" for undervaluation is a misrepresentation and misuse of the findings.
This means → the PBOC is not denying assessments exist — it is denying they can be equated with "China is suppressing its currency."
What signal does this statement send?
"We never engage in competitive devaluation" is a long-standing PBOC line, restated now as US-China trade tensions escalate.
This reflects Beijing choosing to set the narrative proactively rather than respond defensively to external accusations.
In plain terms = the central bank is drawing a line early — don't use FX as a pretext to label China a "manipulator."
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