China says yuan not main cause of Sino-U.S. trade imbalance

The yuan exchange rate is not the main cause of the trade imbalance between China and the United States, the Chinese Foreign Ministry said on Thursday.

Ministry spokesman Hong Lei also told a regular news briefing that China was committed to proceeding with yuan exchange rate reform.

China will unwaveringly advance reform of the renminbi exchange rate formation mechanism based on the principles of maintaining initiative, control and gradualness, Hong said.

We will adhere to a managed floating exchange rate based on market supply and demand, maintaining the basic stability of the renminbi exchange rate at a reasonable and balanced level.

A large number of facts have demonstrated that that the renminbi exchange rate is not the main cause of trade imbalances between China and the U.S, Hong said.

He was responding to comments from the White House that U.S. President Barack Obama would press Chinese President Hu Jintao on trade when Hu visits the United States later this month.

(Reporting by Chris Buckley, Writing by Sui-Lee Wee, Editing by Simon Rabinovitch)