It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
The continually weak U.S. dollar is a constant source of debate among economists and the media. And most of the chatter is decidedly negative. But there are a few benefits, including the effect it has on the bloated U.S. trade deficit. Both economists and the U.S. government are hoping that such dollar weakness will help reduce the nation’s trade deficit, one of the most criticized aspects of the U.S. economy.
In light of this, China has been diversifying its foreign exchange reserves (which top $2 trillion) in order to move away from the dollar into other major currencies and to hedge against the U.S. dollar’s fall. This gradual diversification will help avoid bid market fluctuations, while allowing the yuan to appreciate for the first time in 18 months.