Times online had an article today on China’s yuan rate .
“Expectations of China floating its currency on foreign exchange markets, with large implications for the global economy, have dimmed after industrialised nations declined to increase pressure on Beijing.
The G7 group of leading economies said, at the end of a meeting in the US, that “more flexibility” in exchange rates was “desirable” for major states in promoting global economic stability. The comments were viewed as pertaining particularly to China, which has kept its currency, the yuan, pegged at a rate of 8.28 to the US dollar despite its booming economy and soaring exports.
However, the statement declined, as markets had expected, to raise the tempo of G7 efforts to force a flotation of the yuan, a move which analysts believe would prompt a rocketing of the currency, raising the cost of Chinese exports but at the expense of boosting Western inflation.”
