Friday, April 2, 2010
Hu's US Visit May Signal Easing by China on Currency
The arrival of Chinese President Hu Jintao has brought a new series of implications and speculation of whether or not the Chinese will adjust their currency. Several economists give theories of what the effects would be on the United States if the currency would be appreciated to the dollar. One of the main reasons of this issue is that China is strictly an export economy, shunning the very people who have brought this country to the upper economic echelon. This is a fair article looking at both sides of the issue.
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2 comments:
If China appreciates their currency, this may allow China to focus internally and narrow the gap between regional incomes, instead of being strictly or a majority export economy.
I think its interesting to see how this issue has been politicized where the US politicians blame China for the huge trade imbalance. Clearly it is a two way issue. On the other hand, the Chinese could very well be using this as a political tool as leverage on issues that it wants the US to back off on.
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