China’s Exchange Rate Impasse and the Weak U.S. Dollar

Since 2004, China has been backed into a situation where the renminbi is expected to go ever higher against the dollar, and this one-way bet has led to a loss of domestic monetary control. Combined with a more general flight from the U.S. dollar, the resulting monetary explosion in China contributes to the worldwide increase in primary commodity prices—with excess liquidity reminiscent of the global inflation generated by the weak dollar in the 1970s.

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Year of publication:	2008
Authors:	McKinnon, Ronald Ian ; Schnabl, Gunther
Institutions:	CESifo
Subject:	inflation \| exchange rates \| macro policies \| current account imbalances

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Extent:	application/pdf
Series:	CESifo Working Paper Series.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 2386
Classification:	E31 - Price Level; Inflation; Deflation ; E61 - Policy Objectives; Policy Designs and Consistency; Policy Coordination ; F31 - Foreign Exchange
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005405730