Is China a Currency Manipulator? What (if anything) should we, as the United States, do about it? What would the costs and benefits to the U.S. be of punishing China or letting them continue as they have?
There have been several instances where China has manipulated its currency to take benefits of export. China is keeping its currency artificially low to make its export competitive. Thus, it is able to export massively across the world.
The US is facing a huge trade deficit with China and it is losing jobs to cheap products from China. Now the US has started a trade war against China by imposing tariffs on imports from China. Thus, it has adversely affected the economy of China.
Over the short run, US economy has benefited from such trade war but over the long run, the cost of production might rise significantly and it would not be favorable for future of US economy. There is a need to reach right agreements so that both countries interests are safeguarded. China must stop tampering with its currency and let the market forces work efficiently.
Is China a Currency Manipulator? What (if anything) should we, as the United States, do about...