China's revalued currency? (1 Viewer)

[enigma_1]

What exactly is it?

I don't really get it. Like apparently it got depegged in 2005 in July but what does it mean?
And how did it affect anything?

regards

 

[enigma_1]

Bump

 

[kwu1]

From memory, a pegged currency that has a fixed rate of exchange with other countries e.g. we fixed the Chinese Yuan so 6 Chinese Yuan = 1 Australian dollar. But if we were to depeg it then the exchange rate can vary according to market demand and supply fluctuations. Historically, China has maintained a low pegged exchange rate. There has been a dispute about this because it makes Chinese exports to foreign countries much cheaper and therefore, more price competitive allowing China to yield the benefits of higher economic growth and development processes. Hope that helped