China’s Stock Market Is Expected to Stabilize, Says The Country's Central Bank

An official from the People's Bank of China (PBoC) said that the nation's financial market is expected to be more stable after the yuan stabilizes against dollar and stock market correction is almost completed.

PBoC Governor Zhou Xiaochuan remarks after the meeting participated by finance ministers and central bankers - who promise to "refrain from competitive devaluations" - from the Group of 20 nations in Ankara on Saturday.

An article posted Monday on Irish Examiner notes that the last time G20 has made such a firm declaration was back in 2013, a time when their monetary campaign pitted Japan's yen against the dollar, bringing down the former's rate for about five years.

"At present, the exchange rate of the renminbi against the dollar is stabilizing, the correction in the stock market is already mostly over and the financial markets show hope for stabilizing," Zhou is quoted during the G20 meeting.

Meanwhile, PBoC International Department Director-General Zhu Jun says that the volatility of China's stock markets is almost over. He adds that the devaluation of yuan hasn't intended to put other exporting nations at a disadvantage.

"We think it's pretty close to the end," Zhu says. "To some extent the leverage in the market has been decreased substantially and we think there would be no systemic risk."

She also remarks in a statement, "the Chinese government's intervention has prevented a free-fall in the market and systemic risk."

Meanwhile, a drop in Chinese exports has been recorded in August, as shown by a trade data released this week. Policy makers are considering a change "in infrastructure investment in the wake of monetary and fiscal initiatives," following reports on the deterioration of China's manufacturing sector.

"The Chinese economy's fundamentals are fine," PBoC Deputy Governor Yi Gang comments on Friday. "No one can predict exactly on the market volatility, but I'm confident that the renminbi (another term for yuan) exchange rate will be more or less stable around the equilibrium level."

Chinese Finance Minister Lou Jiwei also says during the meeting that he is expecting that the country's economy will increase at about 7 percent in four to five years time.