CHINA’S YUAN STRENGTHENING VS DOLLAR MAY BENEFIT U.S.
China’s currency, known as the yuan or the renminbi, has strengthened and reached the highest level against the US dollar and other major currencies and Melina Delkic of the New York Times sees the surge in value does not seem to slacken.
In an analysis, Delkic said the development could make Chinese goods more expensive for consumers around the world. Beijing has kept a firm hand on the value of the renminbi, keeping it weak to help factories maintain their low prices when they sell goods overseas.
But now, it looks like the factories don’t need that kind of help: People are still buying, even as the renminbi gets stronger.
This could help relations with the United States. Critics of Beijing in Congress and within the government have long accused the Chinese government of unfairly manipulating the currency in ways that hurt American manufacturers.
Explanation: China is a rare bright spot in an otherwise ravaged global economy: Factories are charging ahead at full steam, with exports booming. Investors are keen to stash their money in the country, while the central bank has room to leave interest rates higher than in Europe and the US.
On Monday, the US dollar was worth 6,47 renminbi, compared with 7.16 renminbi in late May, and close to its strongest level in two-and-a-half years.
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