Is Chinese currency devaluation the reason for the US trade deficit?
The Chinese currency is Renminbi, not Yuan. The Renminbi has been used since the gain of power by the communists. One thing people are probably unaware of is the dual currency system in China. Until the early 1990’s China had an admitted dual currency system. Foreigners could only buy Foreign Exchange Currency or FEC. There was a huge black market trade in currency because Chinese were only allowed to buy a certain amount if traveling overseas. They bought foreign currencies on the black market. Some merchants were allowed to accept the FEC and others were not. This was used to ensure that Chinese couldn’t go to the better restaurants and hotels. Some cities would have a hotel with one floor designated for foreigners. These floors would have a bath room for each room while the other floors would have a communal shower and bath room. Although China officially ended the dual currency, it still exists. They can manipulate the international currency without affecting most of the local curr
