Phelps: China Quite Happy With Weakening Currency

The video discusses currency movements in 2016, focusing on China's approach to managing its currency against the dollar and a basket of currencies. It highlights China's efforts to control market jitters through capital controls and shifting focus to a trade-weighted basket. The discussion also covers the global race to devalue currencies, with China aiming for a stable, competitive position without causing growth concerns.

What was the market's main concern regarding China's currency movements in early 2016?

• A potential shock devaluation

• An increase in inflation

• A rise in interest rates

• A decrease in foreign investments

What strategy did China adopt to manage its currency issues?

• Focusing on the bilateral dollar-China exchange rate

• Increasing foreign reserves

• Implementing new capital controls

• Shifting focus to a trade-weighted basket

What has been a significant factor in underpinning China's economic recovery?

• Reducing trade deficits

• Strong credit growth

• Increasing capital outflow

• Decreasing credit growth

How is the current state of Chinese growth described?

• Unstable and declining

• Stable and comfortable

• Rapidly increasing

• Stagnant

What is the global trend regarding currency values?

• Increasing currency values

• Maintaining stable currency values

• A race to strengthen currencies

• A race to the bottom