About Revaluation of RMB

             On the 2004-02-27 China Daily, there is an editorial titled "RMB revaluation unhelpful to US unemployment: Greenspan".
             "cRevaluation of the Renminbi (RMB) will be of no help to America's unemployment problem, Alan Greenspan, the "economy steersman" said twice in a short period of two monthscFederal Reserve Chairman Alan Greenspan testified to the US Congress on February 11 that attempts to restrict Chinese commodities would offer no help to solving America's unemployment problem. This is his second remark on a China issue in two months, which served as a best dose of sobriety to those clamoring for RMB appreciation.h
             Economists are calling for a rational evaluation of the Chinese yuan (RMB) currency amid an international debate on its true value, and pressure from some of China's trading partners for the government to revalue the currency. From last year, there has been growing voice for the RMB's appreciation in the Western world where some people see China's balance of payments surplus on both current and capital accounts, and the country's rapid increase in foreign exchange reserve. On the contrary, a fact is that the falling US dollar has resulted in the depreciation of RMB, which is pegged to the greenback. Another voice says that China must move aggressively to protect itself from both the falling US dollar and deflation in the United States, both of which continue plaguing the global economy. Of appreciation and depreciation, which one of them is more likely to happen to RMB? Which one of them will do good?
             China's foreign exchange reserves have grown rapidly since the beginning of this year. The central bank has to buy hard currency on the foreign exchange market to keep the yuan, or RMB, stable, raising money supply and fueling fears of inflation. If the People's Bank of China takes measures to ease the inflationary pressure, it will increase the pressure for RMB appreciation. Foreign countries including Japan a...

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About Revaluation of RMB. (1969, December 31). In MegaEssays.com. Retrieved 11:45, March 29, 2024, from https://www.megaessays.com/viewpaper/19588.html