US further pressures China on renminbi revaluation

US further pressures China on renminbi revaluation

Story link: US further pressures China on renminbi revaluation

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The United States has put even more pressure on China to revalue their currency. The US is telling China that if they do not revalue the renminbi by at least 10 percent against the dollar, they face the prospect of trade sanctions being imposed on them.

Senator Charles Schumer has already introduced a bill that would impose sanctions if China does not take action within six months. Besides a minimum 10 percent revaluation, China is being told that they must to take other measures, including a shift to a currency band in relation to the dollar or else a basket against a group of currencies to replace the current peg.

This new demand by the US is a continuation of the change to a more emphatic course of action after earlier, more gentle, urgings for China to revalue its currency had no effect. The new initiative is being pursued in the face of repeated warnings that threats will only make China less likely to act.

To emphasize the seriousness of the threat to China, it is said that several unofficial envoys have approached Chinese officials. These messengers are said to include former US secretary of state Henry Kissinger and Brent Scowcroft, who was national security adviser to former US presidents Gerald Ford and the first president Bush.