Trade in China
China announces recently that it will consider allowing the Yuan to rise against foreign currencies such as the US Dollar and the GBP.
Amid increasing concerns from Western economies, China has indicated that it will consider allowing the value of the Yuan to rise. No specific pledges have been made, however, the Chinese central bank has stated that it plans to make the mechanism for exchange rates more flexible than it has been.
Critics of the Chinese central bank have often highlighted that the Yuan has in effect been pegged to the USD for several decades. This is a move which has led to accusations that China is trying to protect its exporters and increase economic growth as rapidly as possible despite rises in the currency’s value.
The announcement by the Chinese central bank has been welcomed around the world, such as by the President of the United States Barack Obama and the International Monetary Fund. The US has been particularly vocal regarding China’s control over its currency value and repeatedly claimed that these steps were anti competitive and contributed to huge trade surpluses.
Despite no time frame provided by the Chinese government, these are constructive announcements likely to ease criticism and increase political cooperation with China.
