China: To Float or Not to Float? (A), Spanish Version Harvard Case Solution & Analysis

China: To Float or Not to Float? (A), Spanish Version Case Solution

Change in the exchange rate system of China was previously expected and debated in the preceding months as China's trade surplus against America and as friction intensified with Japan and Europe. Additionally, analysts claimed that the closely managed exchange rate put a strain on China's own market. Was. the exchange rate expensive to keep up, but it led to--also as limited China's flexibility in reacting to--a possibly overheating market. Although the wide-ranging controls on the movement of capital into the state of China helped to counteract some inflationary pressure, managements were becoming more porous as China increasingly incorporated with the world market. It remained to be seen what China would finally select to do with its exchange rate regime.

This is just an excerpt. This case is about   GLOBAL BUSINESS

PUBLICATION DATE: March 02, 2006

 

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China: To Float or Not to Float? (A), Spanish Version

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