China's yuan is not facing pressure to strengthen but could instead weaken to about 6.95 to 7 per dollar, a senior economic planning official was quoted on Tuesday as saying.

The yuan, also known as the renminbi (RMB), has stalled against the dollar over the past several months, trading at about 6.83 to 6.84 per dollar.

Some economists have speculated that it could depreciate as Chinese exports shrink in the face of weaker demand in the United States and Europe.

Asked in an interview with China Briefing magazine about whether there would be any change in the position of the yuan, Zhang Xiaoqiang, deputy head of the National Development and Reform Commission, said: 'During Wen Jiabao's trip last month to Europe, we found that the RMB has reached a sustainable and fair level. The currency is not facing any pressure to be stronger. However, our economy this year is weakening, and unemployment is rising. The RMB could weaken to a position of around 6.95 to 7 against the US dollar.'    

Zhang did not elaborate on the timeframe.

The interview was posted on the website of China Briefing, a monthly magazine run by investment advisory firm Dezan Shira & Associates. - Reuters