Author: jimmy67

Are Asian central banks using RMB as reserves now? [Copy link] 中文

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Post time 2007-2-8 22:33:48 |Display all floors
I think we have to look beyond the scope. The only 2 or maybe 3 major currecies highly traded are US dollar, Euro and maybe Yen. I believe most Asian central banks have substansial amount of Euro as reserves.

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Post time 2007-6-14 17:14:57 |Display all floors

Yuan hits new high against dollar

Dong Zhixin (

China's currency hit a new high against the American dollar on Wednesday amid rising and raucous calls in the United States' congress to increase the value of the yuan more quickly.

Before trading started on Wednesday morning, the People's Bank of China set the midpoint at 7.6282, breaking the 7.63 barrier for the first time since China ended the peg to the US dollar on July 2005. The yuan is allowed to move 0.5 percent up or down the midpoint in a day.

The record high central parity rate came after the yuan posted the largest daily gains in two years, rising 0.26 percent to 7.6436 against US dollar on Tuesday.

Analysts attributed the faster appreciation partly to a due US Treasury Department report scheduled to be released Wednesday. The semi-annual evaluation of exchange-rate manipulation may increase pressure for faster revaluation, according to analysts.

Despite pressure from the US Congress, the Bush administration on Wednesday refused to cite China as a country that manipulates its currency to gain unfair trade advantages in its semi-annual currency report.

Hours after the report is unveiled, US lawmakers plan to introduce legislation to push China to loosen controls on the yuan, reports said.

The analysts also pointed to two other factors: The Consumer Price Index, a key measure of inflation, hit a two-year high of 3.4 percent in May, raising the possibility of an interest rates hike, and the country's trade surplus soared 73 percent to US$22.45 billion in May.

They expect the yuan to breach the 7.60 mark against the US dollar at the end of month as the US increases pressure. Some US lawmakers and businesses accuse China of keeping the yuan artificially low to give its exports an unfair advantage.

Concerned about rising tensions with major trading partners, as well as a potential slump in world economy, which will result in fewer demands for Chinese products, China has been taking measures to boost domestic consumption to reverse the over-reliance on exports.

In May, China's retail sales rose 15.9 percent from a year earlier to 715.8 billion yuan, the fastest pace in three years, said the National Bureau of Statistics on Wednesday. The increase came on top of a 15.5 percent gain in April.

The growth was mainly driven by rising incomes and a booming stock market which has soared more than 50 percent so far this year after a 130 percent rally in 2006.

Sales in the country will grow about 14 percent this year, the Ministry of Commerce said earlier this month. China will probably surpass Japan by 2010 to become the world's second-largest consumer goods market after the US, Vice Premier Wu Yi said on May 24.

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Post time 2007-6-14 17:29:23 |Display all floors
It is not time to make RMB fully convertible yet.

As for rising RMB hurting export, frankly, I don't see that. It might dent it a bit, but I don't see a dramatic effect. The key thing to bear in mind is currently China hold almost 90% of world's production capabilities. If rmb rise, it'll just mean the customer has to pay more. It's different from ten years ago where many countries still retained their domestic production capabilities. But now, most domestic production capabilities of the so called developed countries have been utterly destroyed (thanks for offshoring and globalization), even if the market wants to readjust, it'll take time, probably another 5 to 10 years. During that period, China will have ample time to transit to a consumer market.

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Post time 2007-6-25 16:48:16 |Display all floors
Only time will tell whether holding RMB now will prove to be viable or not.

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Post time 2007-7-27 10:31:49 |Display all floors

Renminbi is going to be one of the strongest currencies for many years

Jim Rogers cautiously bullish on China stocks

July 26, 2007

SHANGHAI (Reuters) --- China's stock market is dangerously high but environmental protection, water, railways and renewable energy stocks are still worth holding, fund manager and investment author Jim Rogers said on Thursday.

Rogers, in a presentation at a conference, also reiterated his view to dump dollars and bonds and stay bullish on commodities, such as oil and aluminum. Gold was still going strong, but copper prices look stretched, he added.

A prominent China bull, Rogers said investors should be cautious after China's benchmark Shanghai composite index quadrupled over the past two years.

It closed at a record high on Thursday.

"The stock market is going through the roof over the past three years. That's always a dangerous sign," said Rogers, who co-founded the Quantum hedge fund with billionaire investor George Soros in the 1970s.

"And if you are new to the stock market, you probably think this is the way that things always work. This is not the way the market always works," he said.

"I'm not suggesting you sell your stocks. But I want you to know this is not usual," he said, adding that some Chinese shares were going to collapse as they were "crazily priced."

But Rogers sees opportunities in Chinese companies involved in sectors such as environmental protection, water, green energy, railways and education, where the government and public were expected to spend a lot of money.

"I'm not selling my Chinese shares. As I said, I bought more of them last week. If the market triples again in the next year I would probably have to sell my Chinese shares," said Rogers, who bought his first Chinese stocks in 1999.

Rogers, 64, urged investors to get exposure to the Chinese currency, the Renminbi , and dump the U.S. dollar, which he calls "a terribly flawed currency" as the United States is deep in debt.

"Renminbi is going to be one of the strongest currencies for many years to come," he said.

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Post time 2007-7-27 14:37:25 |Display all floors

Reply #61 chinadaily's post

I wouldn't be too aggressive about it!

What if the United States decides to SABOTAGE China?
and cause crisis with US$ inflation.....

and shrink the China's reserves?

Green DRagon

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Post time 2007-7-29 18:17:40 |Display all floors

Reply #62 greendragon's post

furthermore, the Amerikans could cause trouble in year 2012.

They could invade Myanmar on pretense of some FREEDOM to an BITCHY old lady (with a British spouse) hoping to become President.

Green Dragon

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