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Over-valued Dollar - New Agenda discussion paper

Dear Colleagues,         

 

Please find attached a policy discussion paper titled:

 

“Beyond the Over-valued Dollar: A New Agenda to avoid Future Dollar Misalignments.”

 

The dollar’s valuation roller-coaster has imposed large costs, especially on manufacturing.

 

Whereas the euro and the yen have adjusted significantly, the Chinese yuan has not. This means China is exporting deflation, and revaluation of its currency represents a major piece of unfinished business.

 

In addition, policymakers should implement a system of exchange rates that avoids future major currency misalignments. Such misalignments impose large welfare costs. With the world economy showing signs of shaking off the recent economic slowdown, now is the time to implement a new system that avoids these costs.

 

Tom Palley

 

Thomas I. Palley

Suite 800

1120 19th Street NW

Washington DC 20036

tel: 202-721-5606

tpalley@xxxxxxxxxx

 

Attachment: Dollar_New Agenda.doc
Description: Dollar_New Agenda.doc

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