China's Premier says yuan reforms may be unexpected

BEIJING - China aims to let market supply and demand set exchange rates, and the timing of such reforms could be a surprise, Premier Wen Jiabao said on Monday.

"Our goal has been to let market supply and demand determine the exchange rate," Wen told a news briefing at the close of the annual session of parliament. "We are carrying out such work now, and as for the timing and what measures will be adopted, this could be unexpected."

In his annual report at the start of parliament earlier this month, Wen pledged to push ahead with currency reforms but gave no indication what form the changes would take. Beijing has said it will reform its currency regime only gradually and after solving problems such as overhauling a rickety banking system.

China's policy that keeps the yuan pegged in a narrow range near 8.28 to the US dollar has drawn criticism from trade partners such as the United States, which complain that level is too low and gives Chinese products an unfair price advantage.

- REUTERS