Renminbi revaluation would help dampen inflation

An appreciation of the renminbi against the greenback should lead to the Chinese authorities having more control over inflation, but would have little effect on the size of the United States trade deficit, says Marvin Goodfriend, an academic based at Carnegie Mellon University.

Goodfriend's research uses a New Neoclassical Synthesis model to show that a revaluation would help curb price increases in China. The paper also argues that China can adopt a flexible exchange rate in a few years with

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