The Making of China’s Trade Deficit
The US Congress recently issued its loudest call ever to classify China as an exchange-rate manipulator, accusing Chinese leaders of maintaining the renminbi’s peg to the dollar in order to guarantee a permanent bilateral trade surplus. And yet, at around the same time, in March, China recorded its first monthly trade deficit in six years.
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BEIJING – China registered a monthly trade deficit of $7.2 billion in March 2010, its first since April 2004. And yet, at around the same time, the United States Congress issued its loudest call ever to classify China as an exchange-rate manipulator, accusing Chinese leaders of maintaining the renminbi’s peg to the dollar in order to guarantee a permanent bilateral trade surplus.