Prior to Chinese President Hu Jintao’s U.S. visit next week, Thursday had China central bank leading the yuan at 6.60/dollar that put the currency at mid-point above level daily which is a first. The rise of the yuan shows a long time Beijing pattern for letting the currency appreciation ahead of the a high-profile political summit where it habitually calls for yuan’s further strength.
On Wednesday, U.S. Treasury Secretary Timothy Geithner said China needed to let the yuan strengthen more quickly, a move which could open up long-denied access to U.S. technology.
The People’s Bank of China (PBOC) set yuan’s tone in mid-point versus the dollar at 6.5997. It’s the first reference rate where the yuan may rise or fall 0.5% on a day set stronger than 6.60. The yuan gained 6.5940 against the dollar, 3.53% higher since the currency’s detachment from the U.S. currency in June.
China makes it appear like it resists U.S. yuan appreciation pressure. Truth is, yuan’s strength is permitted ahead of big political events to recognize the significant ties between the two biggest economies.
China is seen to let the appreciation of yuan to 5.4% to 6.3% against the dollar towards the end of 2011 in relation to its inflation curbing efforts. The yuan’s gains versus the dollar increased from its ‘depegging’, more so in the last month.
A 0.72% rise in November happened on the yuan’s nominal effective exchange rate (NEER) which is a recovery from October’s low hit said the Bank for International Settlement data.
Aside from the Chinese currency, the Hu-Obama meeting is seen to tackle other issues and those concerning their trade relations as well as concerns about stability on the Korean peninsula.
On Wednesday, U.S. Treasury Secretary Timothy Geithner said China needed to let the yuan strengthen more quickly, a move which could open up long-denied access to U.S. technology.
The People’s Bank of China (PBOC) set yuan’s tone in mid-point versus the dollar at 6.5997. It’s the first reference rate where the yuan may rise or fall 0.5% on a day set stronger than 6.60. The yuan gained 6.5940 against the dollar, 3.53% higher since the currency’s detachment from the U.S. currency in June.
China makes it appear like it resists U.S. yuan appreciation pressure. Truth is, yuan’s strength is permitted ahead of big political events to recognize the significant ties between the two biggest economies.
China is seen to let the appreciation of yuan to 5.4% to 6.3% against the dollar towards the end of 2011 in relation to its inflation curbing efforts. The yuan’s gains versus the dollar increased from its ‘depegging’, more so in the last month.
A 0.72% rise in November happened on the yuan’s nominal effective exchange rate (NEER) which is a recovery from October’s low hit said the Bank for International Settlement data.
Aside from the Chinese currency, the Hu-Obama meeting is seen to tackle other issues and those concerning their trade relations as well as concerns about stability on the Korean peninsula.