Essays: Monetary Policy: Satisfy China’s Demand for Money
Published By: FEER on eSS | Published Date: August, 04 , 2007A talk with Nobel economics laureate Robert Mundell on how Beijing can keep the yuan’s value fixed and still avoid inflation. China’s high balance of payments surplus and pressure on the yuan could be resolved quite easily by ending the central bank’s sterilization—the practice of following up its interventions in the foreign-currency market by issuing bonds, thereby preventing the money supply from increasing too fast. And no, this wouldn’t lead to a big jump in inflation. [FEER June 2007]
Author(s): Hugo Restall | Posted on: Aug 04, 2007 | Views(2293) | Download (309)