Currency conflict

Fresh pressure from US politicians to expedite the yuan's revaluation only exposes their misplaced belief that an increase in the Chinese currency's exchange rate is the panacea for all their domestic economic ills.

If these people look at hard trade figures, they will realize that they have been shooting themselves in the foot by politicizing the yuan revaluation issue.

On one hand, long-term trade figures compellingly prove that the exchange rate is not the decisive factor behind a country's trade growth. Since July 2005, the Chinese currency has risen by about 20 percent against the US dollar. But this rise in the yuan's value has neither improved the US trade deficit with China much nor stopped China from becoming the world's biggest exporter last year.