Currency Manipulation

[dealmaker]

Currency Manipulation

The U.S. Treasury did not—as was expected—label China a currency manipulator this week. It did say China's policies were of "particular concern" but did not determine in a biannual foreign exchange report that China's authorities were trying to suppress the yuan's value. BBC

 

[JSOP]

Currency Manipulation

The U.S. Treasury did not—as was expected—label China a currency manipulator this week. It did say China's policies were of "particular concern" but did not determine in a biannual foreign exchange report that China's authorities were trying to suppress the yuan's value. BBC

That's cuz China did not devalue its currency significantly as a response to the escalating trade war, at least not yet.

 

[pipeguy]

That's cuz China did not devalue its currency significantly as a response to the escalating trade war, at least not yet.

Actually it devalued a lot but it happened in a kind of natural fashion because of loosening capital flows policy. If China makes it liberal you will see yuan jumping at least twice to 13-14 per dollar.

 

[JSOP]

Actually it devalued a lot but it happened in a kind of natural fashion because of loosening capital flows policy. If China makes it liberal you will see yuan jumping at least twice to 13-14 per dollar.

Yes that's true and when that happens, nobody would want to buy "Made-In-China" products anymore and Walmart would be bankrupt while scrambling to find inventory of cheap goods. China would collapse instantly unless China has already transitioned to a completely self-sustainable domestic economy that can survive on zero exports.

Loosening capital flows policy? How? What's different?

 

[pipeguy]

and Walmart would be bankrupt while scrambling to find inventory of cheap goods.

Well yes, shrinking production and exports from China could be really concern from the Fed as it basically means inflation on consumer goods.

 

[Breezy12]

The Chinese do that in most cases. To avoid inflation they usually try to prevent the Yen from going higher in price. It is called market price control. They control their economy, which has a direct bearing with the price of the Yen in the international market.

 

[Sig]

The Chinese do that in most cases. To avoid inflation they usually try to prevent the Yen from going higher in price. It is called market price control. They control their economy, which has a direct bearing with the price of the Yen in the international market.

Much like setting the federal funds rate also impacts the value of the dollar, but of course that's no manipulation when 'murica is doing it! Seriously, every country in the world "manipulates" their currency to some extent.

 

[sle]

The Chinese do that in most cases. To avoid inflation they usually try to prevent the Yen from going higher in price.

Ahem! Cough! Cough!

 

[Breezy12]

Ahem! Cough! Cough!

My bad. I was going to say Japan... Cough! Cough!