CURRENCY WARS: Foreign currency devaluations against yuan hurting exports, says China....INDIA TO OVERTAKE CHINA GDP GROWTH RATE

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The devaluation of currencies by some countries has led to sharp gains in the yuan which are hurting the competitiveness of Chinese exports, the trade ministry said today.

The Ministry of Commerce did not identify the countries which it said were devaluing their currencies, while promising China would keep the yuan at a “basically stable” level.

The effective exchange rate of the yuan — also known as the renminbi — climbed 6.4 per cent against a basket of currencies in 2014 and rose another 4.2 per cent in the first three months of this year, the ministry said in an online statement.

The yuan is closely managed by China’s government and its value is ostensibly tied to a basket of currencies, even though some economists believe that it mostly tracks the dollar.

The yuan has been more subdued against the dollar, down 2.5 per cent in 2014 and flat so far this year.


“In the current state of economic downturn, some countries have used their exchange rates as an important tool to boost exports, stimulate the economy and push for currency devaluation,” the ministry said.

“That has led to a sharp appreciation in the renminbi, and seriously affected the international competitiveness of China’s export products,” it said, adding that Chinese exports faced rising pressure. -

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Last Edited by Uncle Fuck Stick on 05/10/2015 10:36 PM