China expects pressure on yuan to ease
Published: Feb. 11, 2010 at 2:21 AM
BEIJING, Feb. 11 (UPI) -- China's rising domestic demand and drop in its trade surplus may ease global pressure to revise its undervalued yuan upward, China Daily said quoting analysts.
The undervalued yuan, which makes Chinese exports cheaper and imports dearer, has resurfaced in the administration of U.S. President Barack Obama as its battles huge fiscal and trade deficits and massive unemployment.
The currency question is one of the issues seriously straining Sino-U.S. relations aside from Obama's decisions to sell arms to Taiwan and meet with the Dalai Lama and the growing trade disputes arising from China's government subsidies to exports.
The China Daily report said January Chinese imports totaled $95.31 billion, up a sharp 85.5 percent from last year, while January trade surplus, hit by the global financial crisis, fell 64 percent to $39.3 billion. However, January exports rose 21 percent from a year earlier.
"The month-on-month figures show that recovery of China's exports is still fragile, but any strain for the revaluing of the yuan is loosening," Standard Chartered economist Yan Jinny told the newspaper. "There is little possibility that China will appreciate the yuan in the first half."
Western exports estimate the yuan is undervalued by 25 percent to 40 percent against the U.S. dollar and other currencies. China last year surpassed Germany as the world's largest exporter.
The China Daily report quoted Chinese economists as urging their government not to speed up the appreciation of the yuan under U.S. pressure.
"It's not the right time to revalue the yuan as China is still very much reliant on exports," economist Wang Xiaoguang with the Chinese Academy of Governance told China Daily.
Published: Feb. 11, 2010 at 2:21 AM
BEIJING, Feb. 11 (UPI) -- China's rising domestic demand and drop in its trade surplus may ease global pressure to revise its undervalued yuan upward, China Daily said quoting analysts.
The undervalued yuan, which makes Chinese exports cheaper and imports dearer, has resurfaced in the administration of U.S. President Barack Obama as its battles huge fiscal and trade deficits and massive unemployment.
The currency question is one of the issues seriously straining Sino-U.S. relations aside from Obama's decisions to sell arms to Taiwan and meet with the Dalai Lama and the growing trade disputes arising from China's government subsidies to exports.
The China Daily report said January Chinese imports totaled $95.31 billion, up a sharp 85.5 percent from last year, while January trade surplus, hit by the global financial crisis, fell 64 percent to $39.3 billion. However, January exports rose 21 percent from a year earlier.
"The month-on-month figures show that recovery of China's exports is still fragile, but any strain for the revaluing of the yuan is loosening," Standard Chartered economist Yan Jinny told the newspaper. "There is little possibility that China will appreciate the yuan in the first half."
Western exports estimate the yuan is undervalued by 25 percent to 40 percent against the U.S. dollar and other currencies. China last year surpassed Germany as the world's largest exporter.
The China Daily report quoted Chinese economists as urging their government not to speed up the appreciation of the yuan under U.S. pressure.
"It's not the right time to revalue the yuan as China is still very much reliant on exports," economist Wang Xiaoguang with the Chinese Academy of Governance told China Daily.