Yuan-Dollar Battle Continues

Despite currency's growth, US criticism of Beijing endures
By Jim O'Neill,  Newser User
Posted Dec 31, 2007 9:50 AM CST
Li Jian Rong, left, and her husband, Cao Yin, tourists from Kun Ming, China, get a view of the city from atop the Empire State building in New York, in this June 21 , 2007 file photo. Chinese citizens...   (Associated Press)
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(Newser) – Despite the yuan's continued appreciation against the dollar this year, at nearly 7%—double its growth in 2006—critics say the currency needs to adjust even higher to balance China's trade surplus, reports the Wall Street Journal. In the US, China’s economic strength has become a standard concern on the presidential campaign trail as candidates decry Bejiing’s currency manipulation.

Analysts expect the yuan to become pricier in 2008, easing economic growth pains: inflation, a swelling account surplus, and worrisome overvaluation in Chinese stock markets. But US officials want more, arguing change isn’t occurring fast enough. China’s foreign-exchange reserves are expected to hit $1.5 trillion soon, a sign the country's export business won’t slow anytime soon.