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The Chinese Yuan has been appreciating gradually since it was freed from a peg to the U.S. dollar

and allowed to float within a range pegged to a basket of currencies.

Economists expect the Yuan to keep appreciating, which may have a positive impact on the current

account and balance.

But in the new trade briefing paper, who's manipulating whom, China's currency and the

U.S. economy, Director of Cato Center for Trade Policy Studies, Dan Griswold

tells us to quit worrying about the UAN and the current account and to keep trading.

Does China's fixed exchange rate give Chinese imports an unfair advantage over U.S. manufacturers?

You know, China has maintained a fixed exchange rate for the last 10 years, a basically fixed exchange rate, and this is not unusual.

Over half of IMF members have a fixed exchange rate and this is not unusual.

Over half of IMF members have a fixed exchange rate of some kind or another,

most of them developing countries and China is still a developing country.

There's no evidence that this fixed exchange rate has given China any sort of lasting

advantage in the global economy. They've basically adopted a fixed currency because it leads

to economic stability. All our analysis in my recent study shows that it has not given Chinese

exporters any significant advantage in the U.S. economy and it hasn't hurt the ability of U.S.

companies to do business in China.

Seeing how US objects to this, why does China still insist on fixing its exchange rate instead

of letting it float?

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