Wen Jiabao, the Chinese premier, on Wednesday rejected US and EU calls for a significant rise in the yuan, saying that it could prove to be a "disaster for the world".
On the same day, Tim Geithner, the US Treasury Secretary, said that a "damaging dynamic" of large economies keeping their currencies undervalued could push up inflation and produce asset bubbles.
The United States has been increasing the pressure on the Chinese to allow the yuan to rise, amid disappointment that it has increased by only 2 per cent against the US dollar since an apparent loosening in Beijing's currency regime in June.
So, if I'm reading this right, when you combine it with the Fed discussions saying that they will soon embark on another round of "qualitative easing", the US is basically saying
"Hey China, we don't like the fact that you're controlling the Yuan but we're doing the same to our dollar. Shame on you, Yay us!"
Seems a little hypocritical to me!
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