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  • Thursday, May 26, 2005

    China rejects US demands for currency devaluation

    Why on earth should any country have to devalue its currency purely on the say so of another country? If the country making the demands is in a financial mess of its own making, then it has no right telling other countries what to do. This article from MSN:

    "China will not do this when internal conditions are not ripe, no matter how great the external pressure is," said the spokesman, Kong Quan. China has long said it will dump the decade-old peg to the US dollar in favour of a more flexible exchange rate system, but it has not commented on the timing of such a move. Ha Jiming, chief economist at China International Capital Corporation, the country's largest investment bank, said that, although the timing was right for a change in currency policy, 10 per cent was too large a move at the beginning.
    See all recent "A Logical Voice" posts

    7 Comments:

    At 5/27/2005 12:40:00 pm, Blogger Allan@Aberdeen said...

    What would happen to the rate of yuan against dollar were it (the yuan) allowed to float?

     
    At 5/28/2005 12:27:00 pm, Blogger Voice 1 said...

    Perhaps you could tell us Allan?

     
    At 5/30/2005 03:01:00 am, Blogger DJEB said...

    Or not.

     
    At 5/31/2005 10:12:00 pm, Anonymous Anonymous said...

    I thought there was a resident economist (and biologist and logician and linguist) on this site. That's why I asked the question: in order to learn from you.

    Allan@Aberdeen

     
    At 5/31/2005 10:59:00 pm, Blogger DJEB said...

    So your not going to say anything then. I see.

     
    At 6/01/2005 11:46:00 am, Anonymous Anonymous said...

    "So your (sic) not going to say anything then. I see."

    Try this. China is running a large trade surplus with the US and its currency would appreciate against the dollar were it free to float: it isn't hence the American annoyance with China's currency policy. The Americans merely wish to correct the value of China's yuan against their own currency. If this is disputed, then why doesn't the Chinese govt float the yuan?

    Allan@Aberdeen

     
    At 6/02/2005 02:40:00 am, Blogger DJEB said...

    Well there we go.

    But as Voice said, "Why on earth should any country have to devalue its currency purely on the say so of another country?"

     

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