Morgan Stanley expert supports gradual renminbi hike
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China should be allowed with a right to manage its own currency reforms and to revalue the yuan in a gradual way, an expert visiting Seoul said Tuesday.
"China has every rights to manage its currency reforms and appreciation in a gradual way," Stephen Roach, non-executive chairman of Morgan Stanley Asia, told a local business forum, taking sides with the recent currency move by China.
The remarks came amid escalating tension between China and the U.S. over the revaluation of the renminbi.
While U.S. policymakers have been blaming China for undervaluing currency, which was the major source of its massive trade surplus, China stood firm in its stance that its currency policy had nothing to do with the U.S.-China trade imbalance.
"(It) is not necessarily manifest in mis-evaluation of the currency," Roach said, rather suggesting Chinese officials to focus on aggressive pro-consumption policy stimulus measures.
According to Roach, China's policy to boost domestic consumption would lead to an increase in U.S. exports to China, and thus to employment.
Stephen Roach, who also serves as a lecturer at Yale University, is currently visiting Seoul to attend the World Knowledge Forum, which brought together the world's top-level experts, such as Nouriel Roubini and Paul Krugman.
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