Is the Chinese yuan undervaluation by 40% equally meant the US dollars is 40% overvalued?
Answer:
US is trying to bring down dollar rates across to compete against euro and stronger currencies like UK pound
its trying to create a demand for its currency as it knows it will rule world business shrewdly if it can manage to do so.
still china on the other hand, is yet to re valuate its currency which the world is trying to push it to do so. the day that happens dollar will emerge stronger
No. It means that the UK pound is the strongest currency in the world at the moment. :)
It is generally considered that because the flotation rate of the Yuan (RMB) is closely monitored/controlled by the Chinese government the exchange rate is too high against major currencies. NOT the reverse...certainly not for the US dollar (exchange rate considered Ok at the moment). Strength of the pound gives concern because exports cost more and thus it's more difficult to compete in overseas markets.
The Chinese yuan is not allowed (by it's government, the CP) to float freely in value against the U.S. dollar. Thus, it's value is artificial to begin with.
The strongest currency in the world is the one which you have the most of.
well then buy all canadian dollars.
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