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NBR Briefing

Concise policy papers and significant research findings by leading scholars, corporate executives, and current and former policymakers.

Renminbi Revaluation

As the U.S. trade deficit with China balloons, calls are being made in the United States for the Chinese government to revalue its currency, the renminbi (or yuan). The argument, in its briefest form, is that if the renminbi (which has thus far been pegged to the dollar at the approximate rate of 8.3 to 1) is allowed to grow in value relative to the dollar, then Chinese goods will become more expensive, and U.S. goods in China will become cheaper. Theoretically this means that the U.S. trade deficit with China should shrink, and that manufacturing jobs in the United States will be saved.

Table of Contents

Renminbi Revaluation
Joseph P. Ferguson