Differences between the G7 countries and the euro zone increased the pressure of RMB appreciation

Differences between the G7 countries and the euro zone increased the pressure of RMB appreciation


Recently, the international financial market prices of the major indicators has been great changes, including the dollar and the euro price movements particularly impressive, which reflects the 13 euro zone countries and the G7 countries on the dollar and the euro exchange rate for the euro zone and the resulting changes in the global economy and the pressures and challenges facing the prospect of the differences in expand. 13 euro zone countries and the G7 countries to expand their differences "force" is the result of the appreciation of the renminbi will be forced.

First, the "13 euro zone countries" differences will affect "the G-7 countries" difficult to reach a consensus, will ultimately affect the global economy and the international financial market changes. After the rapid rise in the euro, the euro zone finance ministers meeting revealed a message, the euro zone finance ministers on issues such as the euro value of the larger differences between the views and attitudes, it also tends to cause the euro zone economy and the policy of cooperation will become more difficult.

For example, France and Italy strongly oppose appreciation of the euro, French President Sarkozy has repeatedly criticized the European Central Bank does not take effective measures to stop the continuing appreciation of the euro, France and caused a decline in exports and economy. Therefore, in the euro zone finance ministers meeting, France and other members to try to convince other member states of the United States has adopted a hardline stance that the upcoming G-7 finance ministers meeting to force the United States to take measures to maintain exchange rate stability. However, Germany and the Netherlands, Austria, and other countries have expressed support for the euro appreciation. This shows that the appreciation of the euro on euro zone member countries and countermeasures to cope with the dollar's depreciation seems to be difficult to reach a consensus.

It is worth noting that Germany, France and Italy for the G-7 member countries, when the 13 euro zone countries on a number of issues it is difficult to form a consensus, I believe that the G-7 countries also difficult to reach a unified consensus, let alone the United States is the main G-7 parties, and its impact is more predominant role status. The G-7 meeting will be held on October 19 in the United States, if the G-7 meeting, like the 13 euro zone finance ministers meeting as it is difficult to form a consensus, which would have global financial market fluctuations have certain negative impact on the euro zone also will cast a shadow over prospects for economic cooperation.

In fact, not only by the euro-zone economy from the dollar's depreciation of the exchange rate policy strategy pincer attack, but also by the United States and the economic impact of fluctuations implicated. Recently, the euro appreciation of the euro member countries facing the pressure of more and more severe, causing them to dollar-denominated export prices rise and decline in competitiveness. Similarly, the United States Subordinated Debt crisis triggered by turmoil in financial markets has also significantly affected the current and next year the euro zone's economic growth prospects, according to the European Commission's latest forecast shows that in the third quarter and the fourth quarter of the euro zone economic growth only 0.5%, the annual economic growth rate of 2 .5% compared to the spring forecast downward by 0.1 percentage points.

"13 euro zone countries" and the "G-7" intensify the differences between their own in the final hurt, but it also expanded its on the global economy and international financial impact of future large fluctuations in the international financial price seems it is difficult to avoid the risks faced by the international financial pressure will be more grim.

Second, the pressure of RMB appreciation instead. The major western developed countries has a solid economic scale and financial strength, which on the global economy and the international financial market movements in the emerging differences of opinion, will ultimately hurt the developing countries, is the first to bear the brunt of China's.

The United States has always appreciation of the renminbi, as its main objective, and continue to guide or accumulation induced by the market will focus on the issue of the RMB exchange rate. Along with the dollar devaluation, the pressure of RMB appreciation in the expansion, this result is the United States eased economic structural problem. However, the dollar depreciation of other currencies comprehensive, but also allow the United States has become the beneficiary of the real exchange rate policy. For example, to reduce the United States trade deficit of about 80 billion US dollars, the budget deficit be reduced by about 160 billion US dollars.

At the same time, the continued appreciation of the RMB and the changes in the external economic environment, leading to China's economic and financial structural issue more prominent. Because appreciation of the RMB in China led to the gradual increase in inflationary pressures, and the resulting economic problems to surface, making China's difficulty in adjusting the economy increased.

More seriously, the United States monetary policy led the euro and the RMB revaluation pressure unilateralism, resulting in the euro zone signs of slowdown in economic growth, although the euro-area countries to the United States might do, but the attitude of China's renminbi has happened to change. Because although the renminbi against the dollar in a rising, but the renminbi exchange rate against the euro but were falling. Thus, the euro zone finance ministers will on the issue of the euro against the yuan primary consideration location, the change of the past against the RMB moderate attitude. This shows that the euro-area countries also accepted the U.S. stand on the appreciation of the RMB.

Therefore, in the face of such a situation, our country in the future to continue the RMB exchange rate reform, we must not only concern the international situation, but also concerned about the domestic economy and financial development in the status quo, the need for the strategy and wisdom ahead in the reform and expansion of the market, while opening up opportunities for development, but also better control of the resulting the associated risks. Only then can we promote better more quickly China's economic development and financial health.