Alan Beattie

The latest of a stream of paper out of the IMF in the run-up to its meetings next week came out today: the analytical chapters (as opposed to the forecast) of the world economic outlook. Personally I’ve always thought they were more interesting than the forecast, since no-one is that good at macroeconomic forecasting and the Fund doesn’t have access to much more information than anyone else.

Anyway, this one is on economies that have exited from large current account surpluses and how they did it. Short of calling the chapter Memo To Beijing, it could scarcely be less explicit. No big surprise that they recommend an appreciating exchange rate. Read more

Breaking Views’ Wei Gu has a must-read piece out examining who controls the currency. Tip: it’s not the People’s Bank of China, described as a ‘paper tiger’.

The Chinese central bank comes 27th in an official list of 28 ministries, behind the Family Planning Commission and only ahead of the National Audit Office: Read more

Americans are again clamouring for a rise in the renminbi. First, the moral argument: keeping the currency pegged at about 6.83 to the dollar lends Chinese exporters an unfair advantage, critics argue, increasing the Chinese trade surplus. Second, the pragmatic argument: China will have to let the yuan appreciate to combat inflation.

Today, the counter-arguments. Read more

China is carrying out stress tests on labor-intensive industries to gauge the effect a stronger yuan would have on earnings, reports Bloomberg (itself reporting local paper the 21st Century Business Herald). Consequent speculation on the yuan has pushed forward prices up.

The yuan’s value has been kept at about 6.83 per dollar since July 2008, following a 21 per cent advance over three years, as policymakers intervened to help exporters weather a global recession. Read more

Western economists are accusing China of irresponsibility as it has today reaffirmed its commitment to “moderately loose monetary policy”. But irresponsible for what? Read more