by forcing all foreign exchange to go through the state admin**tration of foreign exchange (safe), china has successfully shielded itself from adverse exchange rate fluctuations in the international market. in addition, by limiting the free settlement ability of the currency to a selected few countries, on top of putting a cap on the daily change on exchange rate, the people's bank of china ** able to stabilize the rate in the short term. china should continue the current practice until rmb becomes a major settlement currency. by limiting the flow of incoming and outgoing foreign currency within china, china can h**e a stable foreign currency reserve that provides a safety cushion for future economic calamities. 20210311