CRI听力:Declining Yuan

The decline of the yuan presents a sharp contrast with its persistent strength in previous years.

Though the consecutive decline has been rare in recent years, analysts attribute it to the market's normal response to China's economic trend.

Yang Tao is a researcher with the Institute of Finance and Banking, affiliated with the Chinese Academy of Social Sciences.

"The pace of China's expanding exports have slowed down, the trade surplus is narrowing. And the growth rate of China's economy also dropped in recent months. Therefore, the short-term decline of the yuan is quite normal."

China is the world's largest exporter. But customs figures show that the country's trade surplus dropped 36 percent in October over a yearly basis.

The major reason behind the new round of the weakening yuan is due to changes in the international market. That's according to Ding Zhijie, professor with the University of International Business and Economics.

"The news sounds horrifying. But after analysis, we realize that this steep decline is not a direct result of pressure forcing the yuan to weaken. The major reason is that investors are buying the U.S. dollars."

Due to the ongoing sovereign debt crisis in European countries, many currencies have weakened against the U.S. dollar. And more investors are turning to the U.S. dollar in order to avert risk.

"Since the debt crisis of the Euro-zone and the United States is far from ending, the market volatility will last for some time."

Despite the volatility, Ding Zhijie says if the Chinese economy manages to grow in a healthy and stable fashion, China's yuan will become stronger over the long run. Yang Tao echoes his opinion.

"Compared to European countries and the United States, China has a much stronger ability to drive the economic growth. Along with the prospect of further financial reform, I believe China's yuan will be stronger during the following four years. "

For CRI, I'm Zhang Ru.