China is “capable and confident” of keeping the renminbi exchange rate stable on a reasonable and balanced level, said Liu Guoqiang, vice governor of the People’s Bank of China.

Liu made the remarks in an interview with Financial News after the recent depreciation of the renminbi against the US dollar amid continuing US-China trade tension.

“China’s foreign exchange market remained steady, despite some overshooting in the yuan exchange rate,” he noted.

Liu said China has gained much experience in dealing with exchange rate fluctuations and has many policy tools available. It will strengthen macro prudential regulation and stabilize market expectations, he added.

“Sound economic fundamentals will continue to bolster the renminbi exchange rate. From international experience, currency crises hardly happen in big countries. As the world’s second largest economy, China has proper macro regulation and effective market mechanisms, so there is no basis for a currency crisis,” he noted.