Thursday, May 17, 2007

China to watch US interest rate and exchange policies

... and from the other side, a thoughtful opinion by Zhang Ming in today's Chinese People's Daily online edition. It notes that changes in the US interest rate might have to be matched by China, but another option is for the US to devalue the dollar. Should the latter occur, it would affect flows of capital between the countries, but (in the writer's view) not so much the Chinese stockmarket, which is mainly powered by domestic investment.

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