The deputy head of China’s State Administration of Foreign Exchange (SAFE) said on Wednesday that the global yuan market should be combined, Caixin reported on Thursday.
Lu Lei, the deputy head of the country’s foreign exchange regulatory body, said there should not be onshore and offshore yuan values, but rather a singular value, the Caixin report said.
The lack of difference in the values would negate the arbitration trade between the two yuan currencies, Lu said, stressing that this was his personal view and not the position of SAFE.
On the topic of the internationalization of the yuan, Lu believes “the trend”cannot be stopped and that there will be more capital inflow into China’s capital markets in future.
Lu said the job of regulatory bodies now is to guide the yuan to US dollar exchange rate to an “optimal point”and to steer more yuan investments into the economy, according the the report.