Journal4 - demanding an increase in Yuan in order to...

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Daniel Yoon Intro to business Professor Reaves K21 9/23/10 House Lashes Out at China Bill Would Give U.S. Power to Levy Tariffs Over Cheap Yuan; Senate May Balk URL:http://online.wsj.com/article/SB1000142405274870411600457552240165184976 6.html?mod=WSJ_World_LEFTSecondNews Lately Chinese foreign exchange policies have undergone much scrutiny as the Chinese government fluctuated their currency in order to increase exports as well as drive the currency of other nations up decreasing foreign competition as well as increase the investment rate of the Chinese Yuan against other national currencies (such as the yen). In response the US has suggested a bill to increase the tariffs on Chinese goods that undercut US products, reducing US exports. With the faltering economy in the US, the government has issued a statement to China
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Unformatted text preview: demanding an increase in Yuan in order to compete against Chinese prices. However the Chinese government has argued that the value of the Yuan is not contingent to the poor recovery of the US economy, rather the US needs cheap Chinese products in order to provide its citizens with cheaper prices as well as providing US companies who produce good in china with cheaper production costs. Furthermore the Chinese government has argued that the bill would violate WTO rules, creating an unfair advantage against Chinese exports. The tense situation in the trade between the US and China has reached its peak as both nations must decide the best measure to assure their economy yet maintain good trade relations with the other country....
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