Beijing says yuan has reached equilibrium against US dollar

China says its currency has approached its equilibrium rate against the US dollar, indicating chances are slim that the yuan will continue rising significantly.

People's Bank of China governor Zhou Xiaochuan , in a speech delivered in Tokyo on his behalf by one of his deputies, stressed the yuan's valuation is mainly determined by the market, not government intervention.

It was an apparent response to vocal concerns among US politicians, including Republican presidential nominee Mitt Romney, that the currency is deliberately undervalued.

Zhou said the central bank had refrained from intervening in the market in the past year, while the exchange rate had remained at around 6.3 yuan per dollar.

"The rate, the spot rate and future rate, determined by the market supply and demand, basically are very close to the equilibrium rate," Zhou said. The yuan had risen more than 30 per cent against the US dollar in nominal terms since 2005, he said.

The speech was delivered yesterday after the annual meetings of the IMF and World Bank in Tokyo, at which Zhou was represented by his deputy Yi Gang .