Why is RMB exchange rate against euro decreasing?

RMB has a fixed RMB exchange rate with the USD.


Its not RMB - EUR but RMB - USD - EUR.





Few months ago was 1.60 euro for 1 dollar. This means a loads of RMB for one euro. Now it has decreased to %26lt;1.40 so a lower exchange rate.





So its cheaper now for all chinese travelers and students who's going to abroad (Europe).|||A mutch better answer is that the chinese government has kept the rmb low by buying up us debt, avoiding its appreciation and keeping exports cheap.





Now their export economy has collapsed and there is no need to protect it.





Unfortunately the us debt is now worth less in RMB.

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|||By the way, this started because the US turned from a consumer economy to a war economy, spending 2000bn in Iraq.


This money would have instead been spent in buying more chinese good, who would then buy more US debt who would then fund more consumerism, creating jobs in China and lots of Wealth in

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|||the US.





Unfortunately for both countries, the hangover is terrible, China has a huge unemployment problem and the US has seen its property and stock prices collapse.





If only the bloody americans had continued buying instead of fighting...

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|||So now, instead of a chinese export led economy and an amercian cunsumer led economy, we have a world wide recession.





Will china and the us rebuild their export/consumer economies? Will China turn into a consumer economy? Will the americans have jobs working to satisfy the chinese demand?

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|||What we are already observing is that America has lost its superpower status and the Chinese Communist Party has lost is reputation for delivering happiness to the Chinese.





How will both societies respond to these changes? The US for one has elected Obama, lets what the CCP does...

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