On April 15 the Obama administration is required to officially declare whether China is manipulating its currency. SInce China is manipulating its currency there is a great deal of pressure on the administration to say so.
Surprise! On April 12 China is now said to be preparing to announce a trade deficit.
The NY Times today points out how this astonishingly coincidental timing will be “a public relations bonanza” for China,
A trade deficit for the current month would be a public relations bonanza for Chinese officials in pushing back against United States pressures for revaluation of the renminbi.
China typically announces its monthly trade during the ninth to 12th day of the next month. If it follows that schedule next month, the trade surplus will be released shortly before the April 15 deadline mandated by the United States Congress to declare whether any foreign country, including China, manipulates the value of its currency.
There may actually be some merit to the claim of a trade deficit, but not for any reason associated with China actually starting to balance imports with exports,
Virtually all Chinese export factories closed for the last two weeks of February in observance of the Lunar New Year, which was unusually late this year. Many struggled to reopen at full capacity because migrant workers were slow to return after the holidays.
The flow of goods to export ports slowed in March as a result, even as imports continued.
So here we are with the decision on the 15th and the surprise announcement coming on the 12th.
Oh, by the way, I wanted to let everyone know that I will be selling a bridge on eBay, and invite you to bid. It’s just coincidentally going to be auctioned just before the Chinese announcement.
