currency warfare clouded G20 summit in Seoul, China and the U.S. monetary policy is the focus of the summit dispute

(Xinhua Zhen roundup) currency warfare clouded G20 summit in Seoul, China and the U.S. monetary policy is the focus of the summit dispute. President Obama and President Hu Jintao held talks in Seoul on Thursday, both sides argued for their own, they criticized each other in a public speech, the other's monetary policy. On the same day, U.S. Treasury secretary innuendo artificially low yuan Beijing an unfair export advantage. And Hu Jintao barbed words that blame the United States to its own people. The summit in Seoul by the media widely referred to as "the most concentrated smell of gunpowder a summit."

Seoul, Hu met with Austrian currency intractable dispute

U.S. officials said the currency dispute and led the U.S. President Barack Obama on Thursday, Chinese President Hu Jintao held talks in Seoul.

The United States has accused Beijing of artificially low exchange rate for Chinese exports an unfair advantage. US-China trade deficit in August this year reached a new high of $ 28,000,000,000. G20 summit to promote the United States wants China to stop the interference, let the yuan appreciate, which will help the U.S. increase exports.

And Beijing has no intention, at least in the short term to do so. Beijing has accused the Federal Reserve recently adopted by 600 billion U.S. dollars quantitative easing inflationary pressure on other countries.

Obama: currency artificially low to cause problems

Barack Obama on Thursday, with South Korean President Lee Myung-bak at a joint press conference that if a country in order to increase exports, by pushing down the currency deliberately, an adverse impact on other countries, and finally it will lead to more problems, rather than solve the problem.

Obama is the Fed's economic stimulus policy has been defense. He said: "The United States can make the most important global economic contribution, is to continue to grow as we continue among the world's largest market, the growth of all other countries is a major driving force."

G20 on Wednesday to prepare the draft communique said, G20 will be banned "competitive exchange rate depreciation," but in brackets there are "undervalued exchange rate competitive," the wording, obviously, China.

Hu Jintao is not criticized the United States

Chinese officials, Hu said after the meeting in Austria, developed countries to take the wrong macro-control policy is one of the causes of global imbalances. Hu Jintao on Friday (12) in his speech at G20 summit in Seoul, it is criticism without naming the United States, that the major reserve currency economies must adopt responsible policies, keeping the exchange rate relatively stable.

However, while Hu oral tough, but when he arrived in Seoul to participate in G20 summit, the day of the renminbi rose 208 basis points in large, central parity of RMB against the U.S. dollar as 6.6242, the highest exchange rate reform in China since 2005 has been the biggest single-day gain.. This is to interpret the outside world to attend G20 summit, President Hu Jintao and subsequently held in Yokohama, Japan, the Asia-Pacific Economic Cooperation meeting, "paving the way", want to reduce the pressure from the international community. Some analysts believe that Beijing may be one of the measures to control inflation, China announced on Thursday, inflation jumped to two-year high.

Huazhongyouhua mistrust

U.S. Treasury secretary on Thursday against the dollar in response to criticism that the U.S. will never be passed down the dollar to gain competitive advantage. The implication that an artificially low yuan Beijing an unfair export advantage.

Before Hu Jintao to attend the summit but said "China will try to do a good job themselves, their problems will not blame others." Means the United States to blame China's own economic problems.

"Washington Post" recently reported that the United States and China had previously talked about a partnership that has largely been replaced by deep mistrust, and now each other very disappointed. Obama recent visit to India, signed billions of dollars in contracts, and expressed support for India to join the permanent members of the United Nations, that the United States is adjusting its policies to accelerate the development of cooperation with India.

Currency war could trigger a trade war

Analysis, if the Seoul summit does not meet the target, might lead to a race down their currencies to maintain export competitiveness, thus triggering a trade war.

The Wall Street Journal reported, for fear of weakening dollar and the devaluation export competitiveness of the country, some countries have begun to take measures to protect their economies. Held in Taiwan this week, restrictions on foreign bonds in October in Brazil and Thailand, increased foreign investment in domestic bond rates, in June South Korea restrictive trade financial derivatives, inhibit the same period in Indonesia, some short-term bonds sold to investors. From Israel to South Africa, including the central banks are buying dollars in order to prevent currency appreciation. ◇