CHINA

Currency Reforms Could Damage Yuan, Bank Report Says: The government may have been hasty when it introduced its recent currency reforms, according to the report from Hang Seng Bank. China abolished its artificially high exchange rate of 5.72 yuan to the U.S. dollar Jan. 1, adopting a rate offered at “swap centers,” where foreign and state companies exchange yuan profits for hard currency. The exchange rate, which is set by supply and demand for dollars and yuan, has been hovering at about 8.72. China’s timing for the changes could have been better, the bank said in its monthly newsletter. With urban inflation running at about 20%, the value of the yuan will be under pressure, it said.