The yuan traded as high as 7.9270 against the dollar on Wednesday, its highest level since Beijing revalued it by 2.1 percent and untethered it from a dollar peg in July 2005. It has now appreciated a further 2.3 percent since then.

Before arriving in China, Paulson warned against hopes of "quick fixes" to Beijing's exchange rate policies.

US officials said Paulson, who took over Treasury in July, had persuaded cabinet colleagues and Bush that a broader economic dialogue with China was needed.

"The intent of this dialogue is to discuss long-term strategic challenges, rather than seeking immediate solutions to the issues of the day," a fact sheet accompanying the official announcement said.

It also said that Washington would "support China in China's goal of building a consumer-driven economy rooted in open markets."

The US officials said ongoing bilateral economic forums, including the Joint Commission on Commerce and Trade that includes the US Commerce Department and US Trade Representative in once-a-year talks with Chinese trade officials, would continue.

Paulson will meet Chinese President Hu Jintao on Friday.

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