Andreas Freytag, 19 May 2008

Europeans are now echoing American concerns about China’s trade surplus. This column argues that there is little reason to worry about Europe’s trade deficit with China nor evidence that China should be pressed to revalue the renminbi.

Shang-Jin Wei, 29 October 2007

Those urging China to adopt a more flexible exchange-rate regime sell the policy advice on the ground that it will substantially speed up the adjustment of global current accounts and that it will also substantially enhance the effectiveness of China’s domestic macroeconomic policies. Both supposed benefits may be exaggerated.

Marvin Goodfriend, Eswar Prasad, 22 August 2007

US and EU pressure on China to revalue the renminbi create the mistaken impression that there is an unavoidable conflict of interests. A switch by China to a more flexible exchange rate regime, accompanied by a shift to a new nominal anchor, would serve China’s domestic interests and simultaneously defuse protectionist sentiments abroad. A politically savvy recasting of this issue as one of Chinese monetary-policy independence could help solve many problems.

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