China's Exchange Rate Policy


October 19, 2007, 12:00 AM EDT
Peterson Institute for International Economics, Washington, DC

C. Fred Bergsten (PIIE), Morris Goldstein (PIIE), Nicholas R. Lardy (PIIE), Jonathan Anderson (UBS, Hong Kong), Fan Gang (People's Bank of China), Eswar S. Prasad (Cornell University), Shang-Jin Wei (Columbia University), Jin Zhongxia (People's Bank of China), Bert Hofman (World Bank), Louis Kuijs (World Bank), Barry P. Bosworth (Brookings Institution), Kenneth S. Rogoff (Harvard University), William R. Cline (PIIE), John Williamson (PIIE), Jeffrey A. Frankel (Harvard University), Simon Johnson (PIIE), Edwin M. Truman (PIIE), Mohamed A. El-Erian (Allianz), Brad Setser (Council on Foreign Relations), Wu Xiaoling (Deputy Governor of the People's Bank of China), Gary Clyde Hufbauer (PIIE), Stephen Roach (Morgan Stanley), Julie Chon (Senate Banking Committee), Takatoshi Ito (Columbia Business School ), Yung Chul Park (Seoul National University), Jean Pisani-Ferry (Bruegel), Michael Mussa (PIIE), Steven Dunaway (International Monetary Fund), Timothy Adams (Lindsey Group), Andrew Crockett (JPMorgan Chase) and Lawrence H. Summers (Harvard University)

Event Summary

Madame Wu Xiaoling, Deputy Governor of the People's Bank of China, delivered the keynote address at the Peterson Institute conference on China's Exchange Rate Policy on October 19. About 25 distinguished speakers, including several Institute senior fellows, representing a variety of views, gathered for the all day event to analyze various aspects of the ongoing controversy surrounding China's exchange rate policies and to suggest appropriate policy prescriptions. Presenters covered monetary policy independence and the currency regime; proposed rebalancing of China's growth (with and without much renminbi appreciation); estimation of the equilibrium exchange rate for the renminbi; management of China's international reserves; influence of the renminbi on other countries' exchange rate policies; currency bills in the US Congress; and China's exchange rate policy and IMF exchange rate surveillance. The conference concluded with a wrap-up panel of experienced observers including Andrew Crockett (JPMorgan Chase), Fan Gang (People's Bank of China), Larry Summers (Harvard University), and C. Fred Bergsten as moderator.

The proceedings of the conference have been published in Debating China's Exchange Rate Policy (Peterson Institute for International Economics, 2008).

Conference Papers and Presentations

Welcoming Remarks C. Fred Bergsten, Peterson Institute


Session I
China's Exchange Rate Policy: An Overview of Some Key Issues
Morris Goldstein, Peterson Institute
Nicholas Lardy, Peterson Institute


  Discussants Jonathan Anderson, UBS, Hong Kong
    Fan Gang, National Economic Research Institute and Monetary Policy Committee, People's Bank of China


Session II

Monetary Policy Independence, the Currency Regime, and the Capital Account in China
Eswar Prasad
Cornell University

  Discussants Shang-Jin Wei, Columbia University
    Jin Zhongxia, People's Bank of China


  Rebalancing China's Growth
Bert Hofman, World Bank
Louis Kuijs, World Bank


  Discussants Barry Bosworth, Brookings Institution
    Kenneth Rogoff, Harvard University


Session III
Estimates of the Equilibrium Exchange Rate of the Renminbi: Is There a Consensus and If Not, Why Not?
William R. Cline, Peterson Institute
John Williamson, Peterson Institute


  Discussants Jeffrey Frankel, Harvard University
    Simon Johnson, International Monetary Fund


  The Management of China's International Reserves: China and a Sovereign Wealth Fund Scorecard
A Scoreboard for Sovereign Wealth Funds
Edwin M.Truman, Peterson Institute


  Discussants Mohamed El-Erian, Harvard Management Company
    Brad Setser, Council on Foreign Relations


Keynote Address

China's Exchange Rate Policy and Economic Restructing [pdf]
Wu Xiaoling
Deputy Governor, People's Bank of China


Session IV

The US Congress and the Chinese Renminbi
Gary Hufbauer and Claire Brunel, Peterson Institute

  Discussants Stephen Roach, Morgan Stanley
    Julie Chon, Senate Banking Committee



The Influence of the Renminbi on Exchange Rate Policy in Other Asian Currencies
Takatoshi Ito, University of Tokyo

  Discussants Yung Chul Park, Seoul National University
    Jean Pisani-Ferry, Bruegel


Session V

IMF Surveillance over China's Exchange Rate Policy
Michael Mussa, Peterson Institute

  Discussants Steven Dunaway, International Monetary Fund
    Timothy Adams, Lindsey Group


Wrap-up Panel


C. Fred Bergsten, Peterson Institute

Andrew Crockett, JPMorgan Chase

Fan Gang, National Economic Research Institute and Monetary Policy Committee, People's Bank of China

Larry Summers, Harvard University