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U.S. Treasury Under Secretary John Taylor said on Saturday that China was taking all the necessary steps toward introducing a flexible currency exchange rate that will benefit itself and the global economy.
"The Chinese continue to emphasize their commitment to move to a flexible exchange rate, and we have seen steps that are consistent with a move in this direction," Taylor said at the conclusion of a Group of Seven finance ministers' meeting.
A senior U.S. Treasury official said later that much of the preparation seemed to have been completed for China to ease its currency peg. "Most of the pieces are in place and largely ready to go in that direction," the official said, but added that the timing of any action by China remained uncertain.
On the sidelines of the G7 gathering, Taylor held separate meetings with China's central bank governor, Zhou Xiaochuan, and Finance Minister Jin Renqing to discuss currencies. "We came away encouraged they recognized the importance of moving toward a flexible currency regime," a U.S. official who attended those meetings on Friday said.