A leading economist at the People's Bank of China urged greater movement in the yuan's exchange rate.

Yu Yongding, also a senior economist at the Chinese Academy of Sciences, told the Financial Times the Chinese government "should allow a bigger band and more flexibility" in the RMB exchange rate.

Meanwhile, the United States reported progress in talks with China on limiting Chinese clothing and textiles imports to the US. Both sides are eager to
sign a deal during President Bush's visit to China later this month.