Chinese Manipulation of Currency

Posted by bjyechan7 on January 18, 2011

China has been manipulating the currency to help its exports. China has been trying to lower the value of its currency, the Yuan, by increasing the value of the value of the currency of the United States of America. China has been buying U.S. dollars continuously to increase the demand for U.S. dollars, ultimately appreciating the U.S. currency. This makes U.S. firms have a more difficult time trying to compete with foreign producers. On the other hand, Chinese firms have easier times trying to export their goods because their currency has depreciated. The United States may be able to combat this by raising the value of Yuan by overly demanding for Chinese goods.

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This entry was posted on January 18, 2011 at 10:57 am and is filed under Section 4. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

One Response to “Chinese Manipulation of Currency”

Ms. Q said

January 19, 2011 at 10:13 pm
Your discussion of China’s currency manipulation will strengthen if you discuss fixed, managed and floating exchange rates while referencing China’s current account surplus. Good luck!

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