Published on December 11, 2016
1. SUBMITTED BY SHUBHAM MONGIA
2. INTRODUCTION PAST SCENERIO IMPACT OF CURRENCY MANIPULATION IMPACTS DEVALUATION GLOBAL IMPACTS
3. China pegged Yuan in 1997 Growth in real GDP Pressure to revalue the currency In 2005,officially the value of yuan changed
4. More exports than imports In 2002-2004,EU’s trade deficit with china had doubled Yuan was undervalued by 15%-20% Political pressures at Home
5. Increase U.S trade deficit Negatively affects U.S business -Chinese imports relatively cheaper -U.S exports to china relatively more expensive Downward pressure on U.S interest rates Capital inflows Compositional shift in U.S economy
6. Reduced risk for investors Increased competitiveness for FDI Higher cost foreign consumer imports Higher cost of imported factor inputs (raw materials, machinery, parts) Lower local wages higher employment Expanded yuan supply, easy credit, non performing loans.
7. De-linked the yuan Widening the trading bank of yuan What next..!!!
8. Devalued its currency in 2005 Increased its exports Growth in GDP Devalued its currency again in 2015
9. Slump in the share market Industry giants to invest in china Other countries GDP imbalanced
10. T H A N K Y O U