China has "removed" the head of its foreign exchange agency, the government said today, following turbulence in the yuan currency caused by what some analysts have called a policy blunder.
Yi Gang had been replaced as the head of the State Administration of Foreign Exchange (SAFE) to be replaced by Pan Gongsheng, a deputy governor of the central People's Bank of China (PBoC), according to a statement on the central government's website.
No reason was given for the moves.
SAFE, which operates under the central bank, is responsible for studying and proposing policies on foreign exchange, according to its website.
Chinese authorities guided the yuan currency down by setting its daily fix lower for eight sessions to last Thursday, representing a 1.4 per cent fall, before reversing on Friday.
The move raised worries of a creeping devaluation, echoing moves in mid-August when China moved the yuan down nearly five per cent over a week, saying the drop was a result of reforms aimed at making the unit more flexible.
The latest weakness has sparked worries China is pursuing a currency war to help boost its exports.
It was unclear whether Yi, who had been administrator of SAFE since 2009, had been sacked. He holds another post as deputy governor of the central bank, on whose website he was still listed today.
Pan has been a central bank deputy governor since 2012, and was previously a vice president of the Agricultural Bank of China.
Today, the central bank fix for the yuan was little changed at 6.5628 to USD 1.0. At 4:30 PM (local time), the yuan was quoted at 6.5750, slightly stronger than yesterday's level at the same time.
But the rate at which banks charge each other to borrow yuan offshore in Hong Kong surged to a record high today, with China's central bank thought to be buying huge amounts of the unit to fend off speculators.
