By BETTINA WASSENER
The Chinese currency strengthened Monday to the highest level in nearly two years in the biggest one-day move since 2005, an early indication that China would allow a gradual rise in the renminbi that it had hinted at over the weekend. Officials from Japan to Thailand to Germany on Monday hailed China's pledge Saturday to "proceed further with reform" of the exchange rate and "enhance" flexibility as a potential boon to their exports and national economies. Many economists believe the stronger renminbi will increase the purchasing power of ordinary Chinese citizens and companies, helping promote global trade in one of the world's largest markets. But China on Monday continued to play down the significance of the renminbi's value in helping to re-balance the global economy. A commentary in the state-run China Daily placed the onus on global leaders to overhaul the global financial system. If leaders don't to make progress at a forthcoming Group of 20 summit to overhaul the financial system, "the international community will soon find to its disappointment that its leaders look only for red herrings, rather than real solutions, at a time when true leadership is badly needed," the commentary said.By the close of business in Asia, the renminbi had advanced 0.42 percent to 6.7976 per dollar. Though seemingly small, the one-day gain is the largest in five years and marks an extraordinary change in China's currency stance. China has hardly allowed the currency to budge over the past two years as it tried to promote its exports during the global economic and financial crisis.At the same time, the announcement triggered an across-the-board rally in Asian and European equity markets as investors cheered the political and economic implications of the move.
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