Sharechat Logo

China revalues and floats currency

Friday 22nd July 2005

Text too small?
China abandoned the 11-year-old peg of its currency, the yuan, and linked it to a basket of currencies.

The immediate effect is a revaluation of the yuan.

From now on, the yuan will be linked to a basket of currencies, the central parities of which will be set at the end of each day, The Economist reports.

And the currency has been revalued 2.11% to 8.11. While this is nothing like as much as the United States and others have been demanding.

The Economist says it was not clear exactly how the new system would operate. The Chinese called it a "managed floating exchange-rate regime", which may well imply more management than floating.

The fact that the Chinese have acted at all is important. But the eventual economic and political effects of the revaluation will depend on how far and how fast the yuan moves from now on, The Economist says.

Bond Offer: Infratil Ltd, 7.2 year & 10.2 year unsecured unsubordinated bond


  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

ANALYSIS: Should penalties for continuous disclosure breaches be relaxed?
Fletcher seeks urgent talks on Ihumatao stalemate
NZ economy grows 0.5% in June quarter, beating expectations
Restaurant Brands lifts 2Q sales; appetite for KFC offsets ditched Starbucks
Auckland jet fuel arrangements a potential barrier to new entrants
NZ dollar weaker after Fed split on outlook for further US cuts
Leading judge says court administration model 'outdated'
MARKET CLOSE: NZ shares fall; Goodman placement sees property stocks sold
NZ dollar eases as market eyes pending GDP data
Evolve shareholders demand answers

IRG See IRG research reports