U.S. have been urging China to let their currency rise faster. But China have so far refused insisting on its own timeline, claiming a rapid rise would cause serious harm to their economy. Congress has just passed a bill to punish China, insisting devaluation is a form of subsidy. China responded by letting the Yuan slips. Chinese media, which is state owned, seems to be in a sour mood also as their English News Channel talks about “American Empire and Cold Peace”.
Brazilian Finance Minister Guido Mantega claim a “quiet currency war” is underway. Brazil, Colombia, Peru, Japan, South Korea and Taiwan are all reported to be trying to keep their currency low. China’s Yuan has gained 1.7 percent this month but U.S. wants it to rise faster to reflect true market condition.