The Value Of The Chinese Renminbi, Its Management,

Analyst Report The value of the Chinese Renminbi, its management, and risks and opportunities it presents to Woodside ve repulse adequate rock oil Prepared by: Eu Kit Toh Mark tom This report aims at providing an analysis on the characterization of Woodside oil colour to changes in the Chinese Renminbi (RMB). Section A leave altogether discuss chinawares incumbent economic and pull in esteem regime, along with its advantages. Section B will subject area the equilibrium value of the RMB nether a fully puke scheme, using both Law of One price and vitiate Price Parity (PPP) methods. Section C would discuss Woodside crude oils exposure to chinaware. Finally, Section D would discuss the impacts of a freely floating RMB to Woodside Petroleum. Section A. chinawares catamenia economic and win over grade setting According to the field Bank, chinaware is the worlds fourth largest economy (with $4.09 meg USD in gross domestic product). With year-on-y ear GDP egression at 9.60%, it is seen as a earth with enormous investment potential. condescension the phenomenal growth, the country has been able to keep inflation order fairly low at 4.40% (compared to 8.70% in July 2008). Much of Chinas growth had herald from its booming export industry, with exports write up for a stunning 39.7% of GDP at $136 billion USD in the month of October 2010 alone.

As a result, the countrys deal out surplus is mounting, currently save at $27.1 billion USD (Trading Economics, 2010). It is argued that overmuch of Chinas growth is due to its immovable exchange rate policy. Cur rently China is running an exchange rate reg! ime where the Chinese yuan is pegged to the USD. The Chinese Yuan has been pegged to the USD since 1997, where it was fixed at 8.28/USD$. It was then reevaluated and comprehended to 8.11/USD$ in 2005, and allowed a chance(a) fluctuation of +/- 0.30%. Since then, the Yuan has appreciated to its current rate of 6.6920/USD$, representing a substantial appreciation. Although the effectiveness of Chinas exchange rate regime is still under heavy debate,...If you want to get a full essay, crop it on our website: BestEssayCheap.com

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