US refuses to call China a currency manipulator (2)

The US trade deficit with China is not a result of China's exchange-rate policies, but of its persistently high fiscal expenditure, according to Ross.

"China engaging in rapid yuan appreciation would not solve the problem, but it would sharply slow the growth of China's economy, which is not desirable for the world economy," Ross added.

On Wednesday, the yuan appreciated to 6.3146 a dollar, the strongest level since China unified its official and market exchange rates at the end of 1993. It has risen approximately 4 percent against the dollar this year.

Hong Lei, a foreign ministry spokesman, told a news conference that the country will continue to allow a broader band for the exchange rate of the yuan and improve reforms related to a basket of different currencies and to float the rate according to market demand.

The exchange-rate issue may be raised again as a political ploy during next year's presidential elections, which may prompt the Chinese authorities to take measures to protect exports, said Jiang Changjian, a professor with the International Relations and Public Affairs Department of the Shanghai-based Fudan University.

A report from Standard Chartered Bank PLC predicted that the Chinese currency is likely to appreciate at a pace of 3.3 percent next year, a slower rate than in 2011.