Renminbi’s Flexible Rate – 10 Years On
China surprised currency traders by announcing it is replacing its decade-long currency peg with a flexible exchange-rate, reports Jennifer Hughes for Financial Times. The renminbi has climbed steadily in value since 2005, reducing trade deficits and tension. “For China-watchers, the renminbi’s gradual moves towards full convertibility with long pauses along the way have become the classic example of China’s general gradualist approach to economic reform,” she writes. “An internationally-accepted currency would help China shift wealth from its foreign exchange reserves ($3tn and counting) to the private sector.” China aspires for the International Monetary Fund to designate the renminbi a reserve currency. Banks in Hong Kong, Singapore, London, Taipei and Seoul are active traders in the currency, Hughes reports, and about a quarter of China’s trading is now settled in its own currency. – YaleGlobal
Renminbi’s Flexible Rate – 10 Years On
China reforms, replacing currency peg with flexible-exchange-rate program, aim at pushing renminbi currency towards reserve status
Tuesday, July 21, 2015
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