China needs to boost imports and domestic demand to better balance the economy, Yi Gang, assistant central bank governor, told a financial forum in Beijing over the weekend.

Exchange-rate changes alone wouldn't be enough, he said.

China wants to curb the dependence of the world's fastest-growing major economy on exports and investment. It has resisted US calls for a faster appreciation of the yuan, which would cool gains in overseas sales by making its goods more expensive.

China exported US$88.3 billion more to the United States than it imported from that country in the first seven months of the year, according to Bloomberg News. Tensions have been heightened by proposed US legislation to press for currency gains and recalls of products, including toys.

"Don't change China's policies, to give in to pressure from the US, Europe and Japan, when politics are forcing protectionism," John Rutledge, an economist, former US presidential adviser, and chairman of Rutledge Capital LLC, said on Saturday at the conference.

Currency revaluation "alone can't resolve the imbalances in China's economy," Yi said. "China needs a package of measures, mainly to boost domestic demand and spending."

The central banker reiterated that China will continue to reform the exchange-rate mechanism and the rate will stay basically stable. The yuan has gained 9.7 percent against the US dollar since a fixed exchange rate ended in July 2005.

The flood of cash from trade surpluses has added pressure for faster currency gains, as the extra money in the financial system threatens to stoke asset bubbles, inflation and wasteful investment leading to manufacturing overcapacity.

The People's Bank of China raised interest rates for the fourth time this year after consumer prices increased 5.6 percent in July from a year earlier, the fastest pace in more than 10 years, because of higher food costs.

Property and stock price gains have prompted warnings of asset bubbles. The benchmark CSI 300 Index of shares has gained 160 percent this year.

China's economy grew 11.9 percent in the second quarter, the fastest expansion in more than 12 years. The nation will overtake the US this year as the largest contributor to global growth, the International Monetary Fund forecast.