Tuesday, February 10, 2009

Is the Chinese Yuan Significantly Undervalued?

The Economist says no:
China has been accused of “manipulating” its currency by Tim Geithner, America’s new treasury secretary, and this week Dominique Strauss-Kahn, the managing director of the IMF, said that it was “common knowledge” that the yuan was undervalued. You would assume that such strong claims were backed by solid proof, but the evidence is, in fact, mixed.
Meanwhile, Foreign Policy says that this whole discussion is moot since China's currency "manipulation" does not matter.

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