Don’t Worry about the Yuan: A crude attempt to “realign” China’s currency would do more harm than good


Publication Date: January 2008

Publisher: Hoover Institution on War, Revolution, and Peace


Research Area: Banking and finance; Economics

Keywords: China; Yuan; Exchange Rates

Type: Brief

Coverage: China


The Currency Exchange Rate Oversight Reform Act of 2007, a bill supported by Democratic chairs and ranking Republican members of the relevant committees in the Senate and House that would punish China for its “misaligned” currency, the yuan, is based on the mistaken premise is that this misalignment threatens our prosperity by causing America’s large current-account deficits with China.