International Law

High-Ranking Chinese Minister Warns, "Our Hands are Tied:" Minor Revaluation May Lead to Catastrophic Currency Risk

Vice Commerce Minister Zhong Shan:

"Water doesn't boil if it is heated to 99 degree Celsius. But it will boil if it is heated by one more degree," he said. Likewise, "a further rise in the yuan by a very small magnitude might cause fundamental changes" to exporters in China, he said.

??????? [Translation: Six of one, half a dozen of the other.]

The Minister's statement represents a curious tactic -- we may see the Vice Minister removed for it (fingers crossed) -- as close to an official proclamation that the "boiling point" of the Chinese economy is at hand. One should note that an egg will still hard-boil at 99°C.

The remainder of the interview is typical clap-trap worth reading for sheer delight.

Full post as published by Asia Business Intelligence on March 18, 2010 (boomark / email).