An article in the December 5th USA Today describes the impact the weakening RMB is having on relations between Beijing and Washington. The RMB has fallen against the USD since my last posting on exchange rates. The article implies this change in direction from the fast rise earlier this year to the stabilization in the fall and now a slight downward trend against the dollar is due to intentional manipulation by the Chinese government. The reporter presents no evidence in this regard. It seems to me the change in direction could be caused by the market within the trading range set by Beijing, but I haven't investigated. The dollar has strengthened against most currencies since the fall I believe.
The exchange rate stabilization is good news for US consumers and OPSA customers. The strengthening dollar is bad news for all exporters in the US, but this is not unique to the situation with China.
Lots of snow here in Green Bay today. Here is the link to the article.
http://www.usatoday.com/money/world/2008-12-04-china-urges-washington-to-protect-investments_N.htm
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