China announced this past weekend that it would loosen controls placed on the yuan, ending the two-year-old pegging of the yuan to the U.S. dollar.
Observers said China appears to be looking to peg the yuan to a basket of currencies, rather than just one.
Chinese officials have been at pains to stress that the apparent return to a “managed float” for the yuan would mean only gradual moves. In Saturday's announcement, the central bank said there was no basis for a “large-scale appreciation” of the yuan. And officials subsequently cautioned against expecting rapid moves.
