World Economy

China Defends Yuan Policy as EU Prepares Tougher Trade Stance

China's central bank pushed back against assertions that the yuan is undervalued, contending that currency adjustments alone cannot address underlying structural imbalances in global trade. The defense came as the European Union prepared to take a harder negotiating line during scheduled talks in Beijing aimed at preventing an economically damaging trade conflict. EU officials are adopting a more assertive approach to address the persistent trade gap between the two economic powers. The exchange-rate debate reflects broader tensions over how to resolve competitive disparities without triggering wider market disruption. Ocean freight rates have climbed to yearly highs as traders navigate uncertainty surrounding bilateral trade relations. European central banks are monitoring energy-cost pressures while attempting to contain spillover effects to broader economic activity.