The Impact of Currency Manipulation


Boosting your exports and limiting your
exports
by pursuing a exchange rate
can only work
as a long ass days one country doing
that or very few countries
of course know if on the path to restore
the major players
or that same time you know I marked on
that strategy
of course a the entire global trading
system
we left collapse this is at Brookings
weekly in-depth look at the issues
behind the news
this week dire consequences currency
china continues to undervalued its
currency to make its exports cheaper and
its coffers bigger
say some legislators and business
leaders it’s a practice that harms US
competitiveness
and impairs the growth other emerging
economies
from the white house to capitol hill the
US is increasingly focused on the issue
and some project a currency war
nonresident senior fellow Dominica
Lombardi says
China’s longtime currency manipulations
are harmful indeed
but war it’s a long way off there is no
doubt to that
the and evaluation under Chinese stuff
currency
as being out openly pursued by the
chinese authorities
and this is really on although 10 their
dealers
a himself pursuing an export-led
strategy
which has certainly continuity and Jim
seventy
dynamism own their own economy over the
I
last few years that’s ok which is not
enough
to really escalate a currency war
did treat your with given by D
a announcement by the US Federal Reserve
to
I start yet another face I’ll hyper
expansionist monetary policy
the so-called acutely to which eso
course
a triggered a every action by a number
of that
emerging economies which are being
flooded by donors
I they’re being pressures thing gym so
their own currency to appreciate
well if we’re not currently engaged
fully engaged in a currency war
then could one arguably say that we’re
standing at the precipice
have a currency war certainly there are
some concerning
a scene of and I this
singing of the car the protracted
stance on the chinese authorities not to
allow their
exchange rate to be fully determined by
the market to despite
their I’m public statements I
there is a a further complicating factor
which is
right now the US monetary policy which
is of course you know
designed to support the have
project I laugh economic recovery but as
as a side effect
you know the a.m. the effect over
clearly weakening dollar in the US there
is
really a great concern about a a
currency issue in Europe I would say
this is
law is the less strongly but not because
it is
fast enough some my no way it’s just
that because there is no
centrally that is not century fine
political authority
because to a how to monitor your set-top
this concern do not easily feed into the
policy making machine
at the EU level what’s the real tension
here I think the
source of tension is a you know more on
setting the boundaries you know on how
far
each player can go is a growing sense of
frustration among US companies
that I’m they a
don’t feel is a level playing field in
China
the Chinese having I’m sufficient number
a restriction seen procurement rules for
instance
that to do discriminate against foreign
companies
and a I think rightly so the
administration
is trying to pursue it broader agenda
vis-a-vis the Chinese
not just by focusing on narrow issue
with the exchange rate
met by you know but they’re pursuing a
broader agenda that
would enable US companies to
benefit from hadn’t establishing a more
robust presence
in China and so that you know they can
really benefit from
from the name is modest emerging
economies wow how does all of this
affect emerging economies if the Chinese
turn off to a more forward
a and allow more flexibility in their
exchange rate
clearly there is the risk that to their
relationship with the other emerging
economies
which shows some of I know pension
clearly this emerging economies so far
have resisted from
openly challenging the Chinese in that
regard
I that a if the Chinese not sure
you know any flexibility and there is
threatening injuries
that a.m. we could see a break
happy in the Pronto new engine economies
I’m
and and i think im this is really where
the challenge lies nowadays
and no one really knows at which point
you know where again I’m
we may have showed this break happy now
this tension erupting and long and
wrenching economy has the g20 or the IMF
had
any real success in dealing with this
issue in the context of the recent the
g20 summit
in korea last november it was agreed
that
China would become the number three
share or your own game
and or the other a mean emerging
economies the so-called BRICS
wheeler a featuring the top attention
older Saudi
situation and of course this is be
intended objective holding this
a reforming the going on so you’re in
math
is indeed to provide emerging economies
with more
I’m more rights a greater
Voice but at the same time also the
month from them
with a responsibility angry
accountability
for the management Odee global economy
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