China rejects US criticism that it is intentionally undervaluing its currency, the yuan, to protect its markets.

A Chinese foreign ministry spokesperson said Beijing is simply trying to safeguard the yuan's stability and is not out to maintain or increase its trade surplus with the United States.

US President Barack Obama recently said he intends to take a tougher line with China about trade. This includes putting substantial pressure on China to stop artificially depressing its currency, a policy that fuels a persistent trade gap with the United States.

The president's tough statement comes at a time when Sino-American relations are already strained. China is furious about US arms sales to Taiwan and Mr Obama's plan to meet the Dalai Lama, Tibet's spiritual leader.