Aug 14 2015
Marketplace explains: floating versus managed exchange rate systems
For years China has kept the value of its currency, the yuan, artificially low in order to help exporters, much to the annoyance of the countries trading partners. European and American trade authorities have called for China to abandon its managed exchange rate system, hoping that a stronger yuan would help their own manufacturers as consumers would demand less of the undervalued Chinese goods.
We’ll, this week China has begun to relax its exchange rate controls, but to the frustration of Western trade promoters, the currency has moved in the wrong direction, actually weakening against the dollar and euro.
Marketplace explains the differences between floating and managed exchange rates in the podcast below.
Comments Off on Marketplace explains: floating versus managed exchange rate systems