China's Exchange Rate Policy: Options and Prescriptions

China's Exchange Rate Policy: Options and Prescriptions

by Morris Goldstein, Nicholas Lardy
     
 

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Over the past five years China has emerged as the world's largest surplus economy; indeed by 2007-08 the size of its surplus relative to its GDP was of a magnitude unprecedented for a large trading economy. This development is especially surprising since in the first 25 years of economic reform China's trade and current account surpluses were quite small by East

Overview

Over the past five years China has emerged as the world's largest surplus economy; indeed by 2007-08 the size of its surplus relative to its GDP was of a magnitude unprecedented for a large trading economy. This development is especially surprising since in the first 25 years of economic reform China's trade and current account surpluses were quite small by East Asian standards, averaging less than 2 percent of GDP.

This book provides a comprehensive analysis of the key economic challenges facing the Chinese authorities in light of the still undervalued exchange rate, the large build-up of foreign exchange reserves, the global economic crisis, and more recently the sharp decline in economic growth. It analyzes the implications of China's exchange rate policy for the effectiveness of monetary policy, the transition to a commercially oriented banking system, the evolving structure of output and demand, and the risk of protectionism abroad. The study takes account of the significant real, effective appreciation of the renminbi over the past 15 months and contrasts the pros and cons of a "stay the course" policy with those of a bolder, "three stage" approach that would seek to maintain recent progress and further correct the undervaluation of the renminbi.

Product Details

ISBN-13:
9780881325164
Publisher:
NetLibrary, Incorporated
Publication date:
07/20/2009
Series:
PA 87
Sold by:
Barnes & Noble
Format:
NOOK Book
File size:
621 KB

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