The exchange rate of the Yuan is not responsible for the United States’ widening trade deficit with China, China’s ambassador to the country said on Thursday. “Personally, I think the root cause for the fiscal deficit and the trade deficit here (in the United States) is not really the exchange rate of the (Yuan),” Zhou Wenzhong told a National Committee on United States-China Relations dinner. China has had a huge trade surplus with the United States, and is the largest foreign holder of U.S. government bonds. The U.S. trade deficit with China widened 9.2 percent in September to $22.1 billion, the highest since November 2008, according to U.S. data released last month. Zhou said that the Yuan had appreciated by some 20 percent since reform of the exchange rate began in 2005. China allowed the Yuan to rise from 2005 to 2008 before effectively repegging it to help its exporters cope with a slump in global demand. It has moved little since.

German central bank Chief Alex Weber rejected on Wednesday calls for Berlin to help reduce global financial imbalances with policy action that would cut the country’s exports and current account surpluses. “This is not something policy should target or can target. It would mean intervening against optimal structures that have developed in a free market environment,” he told reporters during an economic seminar. Weber heads the German Bundesbank.