Yuan Likely to Climb on Worries of US Slump
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The yuan is likely to rise this week as the US dollar continues to weaken on worries of a possible US slump. The yuan ended at 7.2485 on the China Foreign Exchange Trade system in Shanghai from 7.2620 a weak earlier. Last week, Citigroup and Merrill Lynch reported huge losses in the fourth quarter of 2007 due to the subprime crisis. Citigroup lost US$9.8 billion while Merrill Lynch suffered a US$9.83 billion loss in the fourth quarter. The turmoil spread over into the US stock market, leading to concerns the US economy may fall into a recession. A faster appreciation of the yuan is likely amid China's tight monetary policy to fight inflation. |
