China's foreign exchange regulator said Tuesday it would continue to reform its management of foreign exchange in capital account and facilitate steps towards a convertible renminbi (RMB) under capital account this year.

In a short statement on its website, the State Administration of Foreign Exchange (SAFE), China's foreign exchange regulator, said it would simplify the management of external debt financing and further develop yuan-denominated transactions on the capital account.

Monitoring and analysis of cross-border capital flows in 2011 will also be strengthened this year, with more off-site inspections and reviews of transactions, according to the statement.

SAFE also pledged to crack down on illegal "hot money" inflows as investors bet on the appreciation of the yuan, or China's currency.