EOE062 - What we talked about today (18:30-20:00 Sat, 29th Sep. 2018)
EOE062 - What we talked about today (18:30-20:00 Sat, 29th Sep. 2018)
(for reflection and records)
- 18:30-20:00
- A cafe at Yeouido
- Article Selection: https://eoesociety.blogspot.com/2018/09/article-selection-eoe062-sat-29th-sep.html
Six(6) came to the session. Two(2) of them were newcomers. One of them came late.
We managed to finish reading the two articles out of the three selected:
1. How the yuan sets the tone in currency markets and
2. America and China are in a proper trade war.
1.
The first article is about the Chinese currency's increasing clout in foreign exchange markets. Compared to transparent in making decisions and statements of central banks such as the ECB and Federal Reserve when it comes to interest rate raises and timing of it, China's plan is little known and it barely reveals its prior signals of what they're going to do.
In the past, the yuan used to be pegged to USD but since Aug 2016, the government allowed wider corridor for the yuan to move more flexible against the value of USD. Other currencies' values against the USD seem like they are hugely affected by the movement of CNY against the dollar. It's evidenced by the euro-dollar rate which is supposed to be around $1.30 per euro, but it's much below (around $1.15 per euro). The author is arguing that it's because China wouldn't let its currency to appreciate further.
2.
US and China have been ratcheting up tensions in their trade war. The US announced that they will impose tariffs on Chinese imports including furniture, computers and car parts with expected further increase to 25% on Jan 1st next year.
The US argued careful deliberation minimizing the impact on prices excluding Child-safety seats, safety headgear, smartwatches, and Bluetooth devices. However, the author is arguing that most of the products to be affected are intermediate and capital goods push up business costs of American firms.
Trump administration is blaming the WTO for its incomplete rulebook which allows China to force foreign companies to take over their technologies, but they are also the one who is weakening the WTO's system by blocking the appointment of judges to the court of appeals.
They are running out of targets to impose more tariffs on, but there are different approaches they can take like the domestic restriction on the exports of their products such as rare-earth elements just like what they did in the past but was stopped by a decision made by the WTO.
The authors sarcastically pointed out that other countries have no reason to abide by the rulebook while the US is acting outside it.
https://eoesociety.blogspot.com/2018/09/eoe062-what-we-talked-about-today-1830.html
(for reflection and records)
- 18:30-20:00
- A cafe at Yeouido
- Article Selection: https://eoesociety.blogspot.com/2018/09/article-selection-eoe062-sat-29th-sep.html
Six(6) came to the session. Two(2) of them were newcomers. One of them came late.
We managed to finish reading the two articles out of the three selected:
1. How the yuan sets the tone in currency markets and
2. America and China are in a proper trade war.
1.
The first article is about the Chinese currency's increasing clout in foreign exchange markets. Compared to transparent in making decisions and statements of central banks such as the ECB and Federal Reserve when it comes to interest rate raises and timing of it, China's plan is little known and it barely reveals its prior signals of what they're going to do.
In the past, the yuan used to be pegged to USD but since Aug 2016, the government allowed wider corridor for the yuan to move more flexible against the value of USD. Other currencies' values against the USD seem like they are hugely affected by the movement of CNY against the dollar. It's evidenced by the euro-dollar rate which is supposed to be around $1.30 per euro, but it's much below (around $1.15 per euro). The author is arguing that it's because China wouldn't let its currency to appreciate further.
2.
US and China have been ratcheting up tensions in their trade war. The US announced that they will impose tariffs on Chinese imports including furniture, computers and car parts with expected further increase to 25% on Jan 1st next year.
The US argued careful deliberation minimizing the impact on prices excluding Child-safety seats, safety headgear, smartwatches, and Bluetooth devices. However, the author is arguing that most of the products to be affected are intermediate and capital goods push up business costs of American firms.
Trump administration is blaming the WTO for its incomplete rulebook which allows China to force foreign companies to take over their technologies, but they are also the one who is weakening the WTO's system by blocking the appointment of judges to the court of appeals.
They are running out of targets to impose more tariffs on, but there are different approaches they can take like the domestic restriction on the exports of their products such as rare-earth elements just like what they did in the past but was stopped by a decision made by the WTO.
The authors sarcastically pointed out that other countries have no reason to abide by the rulebook while the US is acting outside it.
https://eoesociety.blogspot.com/2018/09/eoe062-what-we-talked-about-today-1830.html
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