From Reuters, via China Daily:
China needs to keep its currency stable because an overly rapid appreciation could hurt its economy, a senior central banker was cited by the official China Securities Journal as saying on Tuesday.
"If the yuan rises too rapidly, a lot of overseas investors might move their factories or companies out of China," Tang Xu, director-general of the research bureau of the People's Bank of China, was quoted as saying.
"That would increase unemployment and hurt our economy, and commercial banks could also face a difficult operating environment," Tang said.
More, from the Wall Street Journal (page A13 of the print edition):
Mr. Tang said China wouldn't want to follow Japan's example in the 1970s and 1980s, when the yen rose rapidly and hurt the Japanese economy.
He said China will continue to develop and enhance the "market-based framework" for exchange rates and interest rates as part of its 2006 monetary-policy outlook.
In other words, steady as she goes.