http://archive.mises.org/8221/appreciating-20-in-three-years-rmb-versus-usd/ Proceeding Ever More Boldly Against Evil Fri, 24 May 2013 20:55:53 +0000 hourly 1 http://wordpress.org/?v=3.5.1 http://archive.mises.org/8221/appreciating-20-in-three-years-rmb-versus-usd/comment-page-1/#comment-365281 Jonathan Tue, 24 Jun 2008 03:47:21 +0000 http://blog.mises.org/archives/008221.asp#comment-365281 Something troubles me with the mercantilist view. Sure the RMB has been kept weaker than it would otherwise have been but presumably this has been at least somewhat offset by higher than otherwise domestic price inflation, so an American may have to hand over less dollars per RMB but he has to pay more RMB per good than without currency intervention. So now we have seen RMB appreciate, we may well see lower domestic RMB price inflation than otherwise. i.e. is it clear that a policy of keeping a currency too cheap actually ends up keeping the cost of the goods sold in dollar terms lower than they would otherwise have been?

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