Currency Manipulation Chinas government and Peoples Bank of China form many

Currency manipulation chinas government and peoples

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Currency Manipulation China's government and People's Bank of China form many shell companies. These shell companies release large amount of Chinese currency through purchasing Dollars. This leads to shortage of dollars and excess of Chinese currency. Hence currency depreciates
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4 The US Current account deficit: -2.4% of GDP in 2018 (negative balance of payment) Bilateral trade deficit with 102 nations. Net national saving rate: 2.4% of national income in 2018 – around 18% of GDP o Hence, proportion of income spent is low o Effect on IS curve: Steeper o Implication: For a given fall in the interest rate, the amount by which income would have to be increased to restore equilibrium in the product market is smaller Net national saving rate of China: around 45% of GDP – however, the household consumption share of Chinese GDP is on decline.
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5 CHINA The share of private consumption in China’s GDP is too low Ownership Transition: Only 15% of Chinese corporations are privately owned – China has been working towards SOE reforms but that comes with the trade-off of state vs market economy (one in which key decisions in the economy are controlled by supply and demand). Structural Rebalancing by focusing on supply-side (productivity) rather than demand-side (consumer) as it is easier to boost services and urbanization than to increase personal consumption
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