May 19 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said China is taking steps to rein in economic stimulus and said the global economy has a “big stake” in seeing the country’s currency rise again.
“China believes it’s in their interest to move, and I’m confident that they, at the right time, will begin to let their exchange rate gradually appreciate again,” he said in an interview that aired today on CNBC. “This is an issue for the world; this is not just the United states. All countries around the world are competing with Chinese companies and so the world as a whole has a big stake in China resuming this process of reform.”
China has held the yuan at about 6.8 per dollar since July 2008, after allowing it to appreciate by 21 percent over the previous three years.
Geithner said China has revalued the yuan “before and they just need to start that process again.” Chinese leaders have shown a “remarkable capacity” in the past three decades to manage their economy’s transitions and have delivered “very strong growth rates,” he said.
“They’re starting to take some important steps to try to dial back the stimulus they put in place,” Geithner said. “They know how to manage these pressures.”
