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A Currency War With Japan Won't Help China Reform Its Economy
China was well into an intended transformation toward a consumer-driven economy when Japan, fittingly enough, threw a wrench into the works. The latest iteration of the "Abenomics" stimulus measures, on top of news of recurring recession, drove down the value of the Japanese yen against the Chinese yuan (or renminbi) by 15% this year.
Of course, the rest of Asia was affected as well, and the business press noted other countries scrambling to keep their currencies from getting out of whack with the yen. But China has held firm so far, basically remaining stable against the U.S. dollar since June. (The Hong Kong dollar, tied to the U.S. greenback, similarly didn't move.) A collapsing world oil price has been a loud accompaniment, helping to sustain the Japanese policy by holding energy import costs in check.
Bundesbank halves 2015 growth outlook for Germany
Dec 5 (Reuters) - Germany's Bundesbank halved its 2015 growth forecast for Europe's largest economy on Friday and also trimmed its estimate for this year, though its president said there were signs that current weakness would soon be overcome.
In bi-annual projections, the bank said it expected the economy to expand by 1.0 percent next year, compared with its June estimate of 2.0 percent.
Bank of Russia Sold $1.9 Billion on Dec. 3 to Stem Ruble Decline
Russia's central bank sold $1.9 billion of foreign currency on Dec. 3 when the ruble ended its worst six-day drop since 1998.
The Bank of Russia intervened in the currency market for the second time since moving to a free float last month, according to a statement on its website today. Policy makers sold $700 million on Dec. 1, the data show. The ruble climbed 1.6 percent to 53.45 versus the dollar as of 10:12 a.m. in Moscow, paring its weekly decline to 5.7 percent.
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