One of the topics covered in chapter 7- and the basis for Discussion Question #6 is the affects of China revaluing the Yuan. For my discussion question, I stated that I did think it would be a good idea for China to revalue the Yuan. While looking online, I came across the article, “Why Would China Revalue The Yuan?” –which strengthened my reasoning. This article states the six main factors that could persuade the Chinese authorities to allow the revaluation of the Yuan. These six factors include; overheating the Chinese economy, the sterilization policy becoming unwieldy, the constrains interest rate policy, the desire to moderate dollar reserve accumulation, the need to balance a growth model, and the pressure China faces from the U.S. and other foreign governments. Take a look and see what you think- does this affect your answer for DQ #6?
http://www.minyanville.com/businessmarkets/articles/china-yuan-revalue-dollar-usd-renminbi/3/15/2010/id/27281?page=2
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