--- SEARCH ---
WEATHER
CHINA
INTERNATIONAL
BUSINESS
CULTURE
GOVERNMENT
SCI-TECH
ENVIRONMENT
SPORTS
LIFE
PEOPLE
TRAVEL
WEEKLY REVIEW
Learning Chinese
Learn to Cook Chinese Dishes
Exchange Rates
Hotel Service
China Calendar


Hot Links
China Development Gateway
Chinese Embassies


Yuan Appreciation Could Present Risk of Bubble

Morgan Stanley's chief Asia economist Andy Xie warned Wednesday that if the yuan is allowed to appreciate under international pressure, China could be caught in a trap of low growth, low interest rates and low inflation but a strong currency. The result could be an economic bubble such as the one seen in Japan, China Radio International reported Wednesday.

Xie pointed out that the macroeconomic situation in China today resembles that of Japan when its currency was pressed to revalue during its period of rapid growth.

At present, at least US$1.2 billion in "hot money" has entered the Chinese mainland and Hong Kong as speculators gamble on a revaluation of the yuan.

The Japanese yen was revalued in 1985, causing domestic companies to move out of the country and invest in Southeast Asian nations.

The low-interest policy that followed created an economic bubble, with excessive investment in stocks and real estate. Japan is still working to recover from the bursting of the bubble in the early 1990s.

(Xinhua News Agency December 2, 2004)

 

No RMB Change While Speculation Is Rampant
RMB Partly Convertible Under Capital Account
RMB Exchange Rate System to Be Improved
Renminbi Interest Rate to Remain Unchanged
Central Bank Governor on Exchange Rate of RMB
China Seeks to Ease RMB Revaluation Pressure
WB Official: Calls to Appreciate RMB 'Groundless'
Print This Page
|
Email This Page
About Us SiteMap Feedback
Copyright © China Internet Information Center. All Rights Reserved
E-mail: webmaster@china.org.cn Tel: 86-10-68326688