Koltso Urala: RMB Is Good for Long-Term Investment

16 October 2012 (10:37)

October, 16 The Chinese yuan vs. the U.S. dollar rate of exchange exceeded the 19-year maximum last week. This was caused by the Chinese authorities’ decision to allow for a small increase in the rate, which came as a surprise for many investors, Bank Koltso Urala reports.

According to The Financial Times, the yuan has gone up by 2% against the dollar in the last three months and now the rate comes to 6.2676 yuan per dollar. On October 12, the growth came to 0.15%. Under the new rules, the yuan rate growth rate is kept within 1% a day.

The yuan used to be traded quite low against the dollar for a while, but in 2005 it started gradual revaluation. The exchange rate has gone up by over a quarter since then, and it will keep growing in the near future.

Bank Koltso Urala’s Currency & Finance Transactions Director Igor Nesterovitch says the Chinese yuan is currently a good thing for those who are ready to invest in the long term, say, for a period of a few years. This has to do with the fact that the yuan exchange rate is controlled by the Chinese authorities, who allow it to grow against the U.S. dollar from time to time.

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