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China's Officials Join the U.S. in Calling for a Stronger Yuan [Copy link] 中文

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Post time 2006-7-31 16:21:12 |Display all floors
According to Bloomberg, a growing number of Chinese policy makers are seeking faster gains in the currency. Last week, Zhu Baoliang, chief economist at a research group linked to the main economic planning agency, have said publicly a stronger yuan is needed to narrow a record trade surplus and control inflation.

Besides Zhu, calls for appreciation also came from Yu Yongding, a central bank policy board member, Xie Fuzhan, deputy director of the government's Research Development Center, and He Fan, an economist at the state-run Chinese Academy of Social Sciences. There are worries that the current growth path isn't sustainable.

``More and more scholars now favor a yuan appreciation and this will help to form a consensus for the government to act,'' said Chen Xingdong, a former official at the state-run economic restructuring agency, now at BNP Paribas Peregrine in Beijing. ``China's decisions are always based on consensus.''

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Post time 2006-7-31 16:31:56 |Display all floors

Expensive

If they do that the goods produced by Indian factories will become cheaper.

Also my hotel will be too expensive.

Everyone will be off to India or back to Thailand

The USA said they will sanction China if they don't do something about the RMB by September.

P.
"We know it's weakness, but the weakness is so strong!"

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Post time 2006-7-31 16:59:43 |Display all floors
Zhu Baoliang said Chinese companies are able to cope with an annual 5 percent advance of yuan. Is that true?

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Post time 2006-8-1 16:03:18 |Display all floors

Price of Oil

It is a global practice to price natural resource such as oil in USD.

Let's assume the exchange rate RMB:USD = 8:1

Let's further assume that 1 barrel of oil costs USD70 = RMB 560.

Now assume the RMB appreciates against the USD, the exchange rate is now RMB:USD = 6:1

1 barrel of oil will cost USD70 x 6 = RMB420.

Suddenly, imported oil becomes cheaper.

No? Yes? Maybe?

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Post time 2006-8-1 18:45:49 |Display all floors
Originally posted by catbird at 2006-7-31 16:59
Zhu Baoliang said Chinese companies are able to cope with an annual 5 percent advance of yuan. Is that true?


SHLD BE OK & SOUNDS REASONABLE!!!

THXS
What's on your mind now........ooooooooooooooo la la....Kind Regards

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Post time 2006-8-1 19:26:14 |Display all floors
Originally posted by cestmoi at 2006-8-1 16:03
It is a global practice to price natural resource such as oil in USD.

Let's assume the exchange rate RMB:USD = 8:1

Let's further assume that 1 barrel of oil costs USD70 = RMB 560.

Now assu ...

the same to import,other countries can use RMB exchanged by oil or other merchandise to buy more chinese commodity.

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Post time 2006-8-1 23:16:24 |Display all floors
Originally posted by cestmoi at 2006-8-1 11:03
Price of Oil

It is a global practice to price natural resource such as oil in USD.

Let's assume the exchange rate RMB:USD = 8:1

Let's further assume that 1 barrel of oil costs USD70 = RMB 560.

Now assume the RMB appreciates against the USD, the exchange rate is now RMB:USD = 6:1

1 barrel of oil will cost USD70 x 6 = RMB420.

Suddenly, imported oil becomes cheaper.

No? Yes? Maybe?


It won't work your way.

The oil in the international market is traded in USD instead of RMB (even a statement of trading oil in EUR will cause war...)  Where to get USD for China to buy the oil?  --- From the export that China made to earn USD.

And because of the appreciation of RMB, the export of Chinese goods will be more expensive than it was before hence it will lost its market and hence it will earn less USD...

Dilemma...

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