The yuan is expected to gain five percent this year to end at 7.44 against the US dollar under a more flexible currency movement, said a group of more than 80 economists.
The Chinese currency is likely to strengthen faster in the first half of this year than in the second half, according to the economists' Xinhua Economic Analysis Report done by Xinhua Economic Information Department.
"Stable appreciation in small steps is generally expected," said the report which was released on Monday. "In the long run, it (the appreciation) depends on the progress of China's exchange rate reforms."
The Xinhua forecast followed those made by banks including Goldman Sachs.
The American bank expects the yuan to climb 5.7 percent against the US currency this year and another 5.3 percent in 2008, it said in December, while Standard Chartered predicts an appreciation of three percent this year.
The yuan settled at 7.8051 against the greenback on the last trading day of 2006, for a rise of 3.4 percent for last year and for an advance of 5.7 percent since China abandoned the decade-long fixed exchange rate of 8.28 to the US currency on July 21, 2005.
Zhou Xiaochuan, governor of the central bank, said over the weekend that China will continue to strengthen and adjust financial controls, stick to a stable currency policy and improve foreign exchange management to ensure the yuan float within a reasonable scale.
China has allowed a daily 0.3 percent trading fluctuation on its yuan and eased currency controls for individuals to purchase bonds and stocks abroad, in the hope that more overseas investments will moderate demand for the yuan, hence cutting its value.
Economists are saying that the government will push the yuan higher more rapidly due to pressure arising from the ballooning trade surplus despite government measures to curb exports.
The China Customs Bureau predicted in December that the nation's trade surplus will swell to a record US$168 billion in 2006, a forecast that analysts viewed as underestimated as the gap has already hit US$157 billion through November. Even so, the expected yearly surplus is still 64 percent higher than the US$102 billion in 2005.
The Chinese currency is likely to strengthen faster in the first half of this year than in the second half, according to the economists' Xinhua Economic Analysis Report done by Xinhua Economic Information Department.
"Stable appreciation in small steps is generally expected," said the report which was released on Monday. "In the long run, it (the appreciation) depends on the progress of China's exchange rate reforms."
The Xinhua forecast followed those made by banks including Goldman Sachs.
The American bank expects the yuan to climb 5.7 percent against the US currency this year and another 5.3 percent in 2008, it said in December, while Standard Chartered predicts an appreciation of three percent this year.
The yuan settled at 7.8051 against the greenback on the last trading day of 2006, for a rise of 3.4 percent for last year and for an advance of 5.7 percent since China abandoned the decade-long fixed exchange rate of 8.28 to the US currency on July 21, 2005.
Zhou Xiaochuan, governor of the central bank, said over the weekend that China will continue to strengthen and adjust financial controls, stick to a stable currency policy and improve foreign exchange management to ensure the yuan float within a reasonable scale.
China has allowed a daily 0.3 percent trading fluctuation on its yuan and eased currency controls for individuals to purchase bonds and stocks abroad, in the hope that more overseas investments will moderate demand for the yuan, hence cutting its value.
Economists are saying that the government will push the yuan higher more rapidly due to pressure arising from the ballooning trade surplus despite government measures to curb exports.
The China Customs Bureau predicted in December that the nation's trade surplus will swell to a record US$168 billion in 2006, a forecast that analysts viewed as underestimated as the gap has already hit US$157 billion through November. Even so, the expected yearly surplus is still 64 percent higher than the US$102 billion in 2005.
