Comparing the yuan's recent moves against the dollar misses the currency's underlying strength of the against a more appropriately watched basket, People's Bank of China (PBOC) Deputy Governor Yi Gang said in remarks released on Chinese state-run media at the weekend.
In a question-and-answer format interview with Xinhua news agency that was posted on the central bank's website, Yi said the yuan remained a strong and stable currency in the global monetary system, while noting concerns about a slide against the dollar after Donald Trump's victory in the Nov. 8 presidential election.
The yuan plunged to eight-and-a-half year lows versus the dollar last week. On Monday, the PBOC set the yuan's central parity rate against the dollar at 6.9042, stronger than the 6.9168 level set on Friday.
"Referencing the yuan against a basket of currencies can better reflect the overall competitiveness of a country's goods and services," Yi said.
Given that economic structures, cycles and interest rate policies differed in various countries, fixating on a single currency was not suitable and may cause the yen to be "over-managed," he added.