As the world’s largest buyer of dollar-denominated commodities, China would benefit from a stronger yuan.
Based on last year’s numbers, an appreciation of about 3%, to 6.6 yuan per dollar, would have saved China roughly $2.8 billion on its iron ore
and copper import bills–enough to buy about 35 million additional tons of iron ore, on top of the 628 million tons it imported in 2009.
If there’s a revaluation, from an import point of view, that’s beneficial,” Luo Bingsheng, vice chairman of the China Iron and Steel Association, or
CISA, said recently. He notes that China is also a growing importer of coking coal–which, like iron ore, is used to make steel. That could have
broader ripples, analyst say: Global commodity prices rallied steadily for more than a year after China raised its exchange rate in 2005, and
commodity prices again rose sharply on June 21, the first trading day after the Chinese central bank’s yuan announcemen
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