The Washington Times
  • Subscribe
  • Times News Services
  • RSS
  • Mobile Headlines
  • e-edition
  • E-MAIL ALERTS
  • REGISTER
  • LOG IN
  • E-MAIL ALERTS
  • WELCOME
  • Your Profile
  • Log Out
  • Front Page Image
  • Classifieds
  • Autos
  • Real Estate
  • Jobs
  • Special Sections
  • Customer Service
  • Home
  • News
  • Opinion
  • Sports
    • NFL
    • NBA/WNBA
    • MLB
    • NHL
    • Tennis
    • Golf
    • Motorsports
    • Soccer
    • NCAA
    • Olympics
    • Outdoors
    • Other
  • Culture
    • Home & Living
    • Family & Kids
    • Fashion
    • Food
    • Travel
    • Health
    • Washington Visitors
    • Books
    • Military History
    • Life
    • Auto
    • TV Listings
    • Movie Listings
    • Death Notices
    • Entertainment
  • Themes
  • Communities
  • Shopping
    • Stores
    • Coupons
    • Daily Double
    • Promotion
    • How It Works
  • Videos
    • Two Guys
    • Birnbaum on Washington
    • Liz Glover
    • Amanda Carpenter
    • Morning Briefing
    • Documentaries
    • Joe Giganti
    • Video Game Minute
  • Podcasts
    • About Headlines
    • Audio and Radio
    • America's Morning News
  • National

    PULLEN: GOP came unmoored in last decade – it hurt

  • National

    WILLIAMS: Finding gratitude in difficult times

  • Sports

    Leonsis in line to buy Wizards, Verizon Center

  • National

    3 airlines fined $175,000 for stranding passengers

  • National

    Ky. hanging, ruled a suicide, leaves bloggers at loss for words

  • Business

    Holiday puts low-cost buses into overtime

  • Politics

    A-listers, fundraisers attend White House state dinner

Thursday, July 21, 2005

China raises exchange rate

Rate this story

Average 0.00
after 0 votes
Login or register to rate this story

  • Font Size -+
  • Print
  • Email
  • Comment
  • Tweet this!
  • Share
  • Article
  • Comments ()
  • Click-2-Listen
  • Videos

More Stories

  • D.C. sports icon, Wizards owner Pollin dead at 85
  • Leonsis in line to buy Wizards, Verizon Center
  • Medical pot gets social
  • Soccer fans' ire stoked

By

China, relenting under enormous pressure from the United States, yesterday raised its exchange rate by 2 percent and adopted a more flexible regime that will permit future increases.

The change, China's first in a decade, sent the dollar plummeting against the Japanese yen, South Korean won and other Asian currencies. Malaysia announced it will follow China's lead in raising its currency.

While the initial drop in the dollar was too small to reduce the U.S. trade deficit by much, with further declines it eventually may lead to an improvement, analysts said, particularly if other Asian countries officially join in the currency realignment.

In the most dramatic reaction yesterday, U.S. interest rates rose sharply as investors worried that China -- a major buyer of U.S. Treasury bonds in recent years -- will be purchasing fewer U.S. dollars and securities to maintain a fixed currency.

The jump in interest rates bodes badly for the booming housing market in the U.S., where record sales and soaring home prices have been fed by Asian bond purchases that have helped keep mortgage rates at their lowest levels in decades.

U.S. Treasury Secretary John W. Snow, who has been negotiating the change with leaders in Beijing for two years, said it would be "good for China and good for the global economy."

Like others who remain wary of China's intentions, however, he called for "full implementation" of the flexible exchange regime and said: "We'll obviously want to follow this closely. We're going to want to monitor it."

The move comes a month before China's top leaders are scheduled to meet with President Bush at the White House, and comes after a half year of sharply increased pressure from the administration and members of Congress irritated over the ballooning U.S. deficit with China. That deficit surpassed any other nation and reached an unprecedented $162 billion in the past year.

The Senate overwhelmingly approved a resolution this spring to retaliate with stiff tariffs on all Chinese goods if China continued to link its currency to the dollar. It was seen widely as a first step in a trade war that Federal Reserve Chairman Alan Greenspan warned could have serious consequences for the U.S. economy.

Sen. Charles E. Schumer, New York Democrat and co-author of the Senate resolution, called China's move yesterday "a good first step. ... It's smaller than we had hoped, but to paraphrase the Chinese philosophers, a trip of a thousand miles can well begin with the first baby step."

12Next »

Post a comment

There are comments on this article, submit your opinion!

Commenting is disabled for this entry.
If you feel there is still something worth mentioning about this entry please contact the author or the site admin.

Ask a Question

You Report

Do you have another point of view, photos, audio, video or more information about a story?

Top Stories

Most Read

  1. EDITORIAL: Hiding evidence of global cooling
  2. Top Republican lawmakers not attending State Dinner
  3. Fenty trails Gray in D.C. poll
  4. Conservatives seek test for RNC funds
  5. Food snobs fork over $225 for taste of heritage turkey
More Top Stories »
  1. Religious leaders vow civil disobedience on anti-life issues
  2. Company that repaired Chairman Gray's house lacked license
  3. PRUDEN: Obama's due process doctrine
  4. KELLNER: New Apple mouse really is 'Magic'
  5. Green energy stimulus growing few jobs

Most Shared

  1. EDITORIAL: Hiding evidence of global cooling
  2. The United Socialist States of America
  3. PRUDEN: Obama's due process doctrine
  4. Top Republican lawmakers not attending State Dinner
  5. Fenty trails Gray in D.C. poll
More Top Stories »
  1. Food snobs fork over $225 for taste of heritage turkey
  2. EDITORIAL: Terrorists use Democratic talking points
  3. Conservatives seek test for RNC funds
  4. EDITORIAL: Obama's sacked inspector general
  5. LETTER TO EDITOR: When family ties die

Most Commented

  1. EDITORIAL: Hiding evidence of global cooling
  2. Top Republican lawmakers not attending State Dinner
  3. Conservatives seek test for RNC funds
  4. PRUDEN: Obama's due process doctrine
  5. Lobbyists spending big to shape health care debate
More Top Stories »
  1. Schumer: Dems will pass health bill alone
  2. EDITORIAL: Terrorists use Democratic talking points
  3. WH: Obama Afghan decision 'within days'
  4. EDITORIAL: Schumer's change of heart
  5. Green energy stimulus growing few jobs

Listen to Washington Times Radio

  • America's Morning News

    with John McCaslin and Melanie Morgan

Blogs & Columns

  • Hot Button Blog

    RNC: Breast cancer recommendations may lead to 'rationing'

  • Belief Blog

    Evangelicals OK civil disobedience

  • Out of Context

    Foods that might kill libido

  • On the Fly

    United lifts some 'award' blocking

  • Technology

    Facebook wins round against phishing spammer

  • Redskins 360

    Gray spends day in Memphis

  • SNOBlog

    Beyond 'Woody'

Videos

Advertising Links
TWT Store
  • e-edition
  • Print Edition
  • Weekly Washington Times
TWT Affiliates
  • Middle East Times
  • Golf
  • UPI
  • Arbor Ballroom
  • Washington Times Global
  • About TWT
  • Press Room
  • F.A.Q.
  • Work for TWT
  • Advertise
  • Sponsors
  • Contact Us
  • Privacy Policy
  • Site Map

All site contents © Copyright 2009 The Washington Times, LLC.