The growing acrimony in the international debate over China's currency policy has led some to warn that Beijing could dig in its heels if pushed to hard to let its yuan rise.
Michael Pettis, a professor and China expert at the Carnegie Endowment for International Peace, has put together a thorough and informative look at all things U.S.-China trade. It’s well worth reading and watching the entire thing, but here’s a few highlights that jump out:
from Changing China:
Is latte at Starbucks in China overpriced or is the local currency, the yuan, unexpectedly overvalued? The former is certainly more plausible, but it might be equally true that the yuan, if not overvalued, is at least not as undervalued as other measures suggest.
from Global Investing:
The United States and China hold economic and strategic talks in Washington starting on July 27. The United States, International Monetary Fund and other groups have urged China to allow its currency to appreciate in order to help unwind global imbalances. Here is a chart showing the Chinese yuan vs the U.S. dollar.
from Summit Notebook:
Hiroshi Watanabe, president of the Japan Bank for International Cooperation, saw his share of dollar buying intervention during decades at the nation's finance ministry. But the market veteran says despite prevalent talk recently, a shift away from the greenback as the world's reserve currency may be great in theory, but like the language of Esperanto short on daily practitioners.