Posted on 04/27/2010 7:43:31 AM PDT by TigerLikesRooster
U.S. Lawmaker: China Must Lift Yuan by Significant Amount
Tuesday, 27 Apr 2010 08:07 AM
China needs to raise the value of its currency by a "significant" amount or the United States will take action, a top U.S. lawmaker said in the latest sign that tensions on the yuan remain high.
"I think 2 to 3 percent over a year would be totally unsatisfactory," House of Representatives Ways and Means Committee Chairman Sander Levin said Monday, commenting on a market estimate about the size of a possible move.
"I think it has to be significant. It doesn't have to be all at once. But there has to be clear pattern of revaluation. A clear path," Levin told the Reuters Global Financial Regulation Summit.
Mainstream Western economists estimate China's currency is undervalued by as much as 40 percent, effectively subsidizing its exports and taxing its imports.
China defends its exchange rate policy as an internal matter it manages to maintain economic stability.
Levin, whose committee has jurisdiction over tax and trade issues, said he remained hopeful that U.S.-led multilateral pressure on China would yield good results by the Group of 20 major economies summit meeting in late June.
If not, the United States has various options for exerting pressure on China, such as allowing companies to request the Commerce Department impose "countervailing duties" against China's exchange rate, Levin said.
(Excerpt) Read more at moneynews.com ...
P!
The US government should NOT go down this road. Quietly, everyone in the US (and the world) should greatly reduce purchases of products made in Chile until China floats the Yuan.
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