Under heavy pressure from America, China's leaders have agreed in principle to float the renminbi, but refuse to say when. A floating currency is inevitable as China liberalizes its capital market and eliminates restrictions on international capital movements; otherwise, China would have to surrender control over its money supply and interest rates to the US. Yet China's rulers are right to postpone the decision to float.
Under heavy pressure from America, China's leaders have agreed in principle to float the renminbi, but refuse to say when. A floating currency is inevitable as China liberalizes its capital market and eliminates restrictions on international capital movements; otherwise, China would have to surrender control over its money supply and interest rates to the US. Yet China's rulers are right to postpone the decision to float.