A Chinese trade official defended controls on the yuan as US Treasury Undersecretary Tim Adams ended talks in Beijing seeking greater currency flexibility.
The system of managing the yuan is "suitable for China's current situation," Chinese Vice Minister of Commerce Wei Jianguo (魏建國) told reporters yesterday in Beijing.
Wei declined to comment on talks earlier yesterday between Adams and Chinese officials. Adams declined to speak to reporters before leaving the capital.
The yuan had its biggest gain against the dollar in almost three weeks on Friday on speculation the visit might prompt China to let the currency trade more freely. Adams, the US Treasury's top official for international issues, earlier this month sounded out investors about the potential effect of calling China a currency manipulator, sources said.
"China probably doesn't want to let the US think faster yuan appreciation is just an easy job for them," said Frank Gong (
The yuan has gained less than 1 percent against the dollar since China revalued the currency by 2.1 percent on July 21 and ended a decade-old peg, fuelling complaints by US and European lawmakers who say the currency is kept artificially weak to spur exports. China's trade surplus tripled to a record US$102 billion last year.
The yuan closed higher at 8.0408 to the US dollar in Shanghai yesterday, a gain of 0.02 percent from Friday's close.
The yuan's biggest one-day swing against the dollar under the new system, a managed float against a basket of currencies, is less than 0.1 percent, compared with the 0.3 percent allowed.
The yuan will rise 4.2 percent to 7.7 per dollar in a year, according to forward contracts traded in Hong Kong as of yesterday afternoon. JPMorgan's Gong forecasts the currency will appreciate to 7.2 to the US unit by the end of this year.
Adams this month asked investors and academics in New York and Washington to assess the market reaction if the department labels China a currency manipulator in a semiannual report on exchange rates, people familiar with the situation said.
The Treasury official on Thursday said the US wants Malaysia to make the ringgit more flexible during a visit to Kuala Lumpur, part of an Asian tour that includes his visit to Beijing. He will brief the press in Tokyo tomorrow.
Cheaper exports from China helped swell the US trade deficit with Beijing to a record US$201.6 billion last year.
US Senators Charles Schumer, a Democrat, and Lindsey Graham, a Republican, are proposing legislation that would impose tariffs on Chinese imports unless the yuan is allowed to strengthen.
China's Ministry of Commerce said today that the US government's data overstate the deficit and ignore the benefits that US companies get from operating in China.
"The US has exaggerated its trade deficit with China," spokesman Chong Quan (崇泉) said in a statement on the ministry's Web site, which put the deficit at US$114 billion. The statement didn't give a reason for the discrepancy.
US companies operating in China sell more than US$75 billion of goods and services annually, the ministry said.
Rapid yuan appreciation against the dollar would boost China's jobless rate, deter foreign investment and harm domestic banks, the central bank's head researcher said.
But Stephen Jen, global head of currency research at Morgan Stanley in London, said yuan gains won't deter investment, and last year's revaluation had no adverse impact on unemployment.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
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