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Jiabao was on a visit to the People’s Bank of China, the country’s central bank.
“We will steadily push forward market-based liberalisation of interest rate and improve the renminbi (yuan) exchange rate formation mechanism, while expanding the international use of of renminbi to gradually realise capital account convertibility of the currency,” Jiabao was quoted as saying during a visit to the central bank.
To gradually make the yuan convertible under the capital account, the government should also work to expand the use of the yuan in cross-border trade and investment, Jiabao said.
China’s central bank has launched a new short-term liquidity tool in its open market operations.
Wen also urged government efforts to encourage market-oriented financial innovations, boost the role of financial institutions of all kinds and step up the development of private financial institutions.