China and the US will hold economic talks next month as the two countries work towards reaching a common ground on currency policy.
The US has accused of China on keeping the value of its currency, the yuan, artificially low in order to help its exporters.
China has said that a sudden rise in its currency will be detrimental not only to its export sector but also to its overall economy.
China is the world's largest exporter.
The growth of the Chinese economy over the past few years has been powered by the success of its export sector.
However, China's major trading partners, notably the United States and the European Union, have raised concerns that the government in Beijing has been engineering an economic strategy that gives an unfair advantage to the country's manufacturers, by keeping the yuan artificially low.
A lower valued currency makes Chinese goods cheaper in foreign markets compared with other competitors.
However as the pressure from its trading partners has increased, Beijing has allowed the yuan to slowly appreciate against the US dollar, but not as much as the decision-makers in Washington and Brussels would like.
The Chinese currency has gained almost 5% against the US dollar over the last year.
However, analysts say that despite that gain, the yuan remains undervalued, compared to currencies like the euro and US dollar.
Source: BBC
www.bbc.co.uk
The US has accused of China on keeping the value of its currency, the yuan, artificially low in order to help its exporters.
China has said that a sudden rise in its currency will be detrimental not only to its export sector but also to its overall economy.
China is the world's largest exporter.
The growth of the Chinese economy over the past few years has been powered by the success of its export sector.
However, China's major trading partners, notably the United States and the European Union, have raised concerns that the government in Beijing has been engineering an economic strategy that gives an unfair advantage to the country's manufacturers, by keeping the yuan artificially low.
A lower valued currency makes Chinese goods cheaper in foreign markets compared with other competitors.
However as the pressure from its trading partners has increased, Beijing has allowed the yuan to slowly appreciate against the US dollar, but not as much as the decision-makers in Washington and Brussels would like.
The Chinese currency has gained almost 5% against the US dollar over the last year.
However, analysts say that despite that gain, the yuan remains undervalued, compared to currencies like the euro and US dollar.
Source: BBC
www.bbc.co.uk
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