EU Expects Yuan to Gradually Appreciate

(Wall Street Journal – Andrew Batson)

European Union Trade Commissioner Karel De Gucht said he expects China to make gradual adjustments to its exchange rate over time, but doesn’t think that trade actions or other outside pressure will speed up the process. Mr. De Gucht met with Chinese Commerce Minister Chen Deming in Beijing Tuesday, and said he had argued that a change in China’s currency regime would be beneficial to both Europe and China. But Mr. De Gucht, who was meeting his Chinese counterpart for the first time since being named Europe’s trade envoy in February, didn’t hold out hopes for a quick resolution of an increasingly sensitive issue.

“I think we will have to wait some time. What I would expect is that you would see a gradual adjustment of the yuan,” he said. “I really think they are only going to do it provided it is beneficial to their own economy. I think they will have to come to the conclusion that it is – if not, all the problems we witnessed before the crisis will come back.”Read more here.