Continued from page 1

Mark Zandi, chief economist at Moody’s Analytics, says the tension should ease in 2011 as the U.S. economy improves, the yuan rises and politicians are no longer stumping for votes.

“Allowing a stronger currency would be consistent with the objective of cooling off inflationary pressure,” says Wells Fargo currency strategist Vassili Serebriakov. “China will not want to be seen as responding to political pressure.”