On whose side in the currency war with China?
China needs new markets
to the same level to support economic growth. At this stage in order to stimulate exports, China has more to produce money and obvalivat yuan. Many countries do, the markets
reeling. For example Turkey has also weakened his lyre, which in turn facilitates the export, but it is harder to import.
China has got a new article of export. Cheap goods are not as important acquisition in the West electronics is not very important, everyone needs cheap loans and then China is actually a monopolist, it exports deflation. Product is in great demand, but at the same time very dangerous.
The Chinese government has set a growth rate of 7% and is trying by all means to keep this pace. In its essence it is just a necessity, because otherwise China will suffer a social disaster. The growth of China is economy is, in essence, is a disaster for the rest of the world, the growth of it resources, and China takes abroad. Global financial markets
still do not know what to do, at what level to keep rates on loans.
Many analysts believe that in the world broke out some currency massacre, according to some estimates, China also began to apply the techniques of financial war.
What is actually happening in China* Problems in China have enough property, more precisely, the market prices were released, they are in free fall. Consumer prices in China are rising, in January they gave an increase of 0.8%, which is much less than the inflation in the country. Manufacturers also began to reduce the price of their products, the price pressure only increases. What happens to the Renminbi? He falls and has already reached its minimum in October 2012, the situation in the economy will not achieve its objectives to increase the national income at the level of 7%. Need some stimulus measures, the government should do something which will bring the economy to a new round of growth. All now fixed his gaze on what makes the Central Bank of China. He is doing everything to increase liquidity in the market. This is good, but this is not enough. On Saturday, the interest rate on loans was reduced, so the Bank has already entered the second time this year.
On the market recovery, the markets
immediately reacted to the growth. The Chinese currency dipped against the dollar in 2015% year drawdown reached 1.1% compared with the previous year. Do not think that it is a trifle. If you know that the Chinese currency is pegged to the dollar, it all becomes more than transparent. China is promoting its exports in the United States, at the same time creates difficulties for the promotion of goods from the dollar area to your market.
What is next? And then everything will be like clockwork, the yuan will continue its decline. Although China is policies continue to promote no one will. And here we come to the idea that China, too, began to lead a currency war. All for the sake of deflation in the domestic market, all imports more expensive.
What can give such a policy of China to the world economy? If all goods from China again in all markets
will fall, and it is exporting deflation in other parts of the world.
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