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Last Updated: Monday, 27 March 2006, 16:41 GMT 17:41 UK
Yuan hits new high against dollar
Worker in a Chinese clothes factory
US critics say Chinese exports are too cheap
The Chinese yuan has hit a post-revaluation high against the US dollar.

It closed at 8.0214 on Monday and has now risen 1.1% against the dollar since being revalued by 2.1% last year.

It follows the visit of two US senators who came to study the value of the yuan and its impact on US-Chinese trade.

They are proposing a bill to impose tariffs of up to 27.5% on some Chinese goods unless Beijing moves to free up its currency.

A crucial vote on the issue is scheduled to take place in the US Senate on Friday.

Trade deficit

Some US politicians and manufacturers believe the yuan is undervalued by 15-40% against the dollar.

They say this makes Chinese exports artificially cheap and led to the huge $202bn (116bn) trade deficit the US had with China in 2005.

China has ruled out another revaluation since raising the yuan's value last July.

Prior to that, the currency had been fixed at 8.28 yuan to the US dollar for 10 years.

The yuan is allowed to rise or fall by 0.3% each day, from a mid-point set by China's central bank.


SEE ALSO:
US senators press China on yuan
21 Mar 06 |  Business
US trade deficit soars to record
14 Mar 06 |  Business
US toughens stance on China trade
14 Feb 06 |  Business
China's trade surplus 'to fall'
09 Feb 06 |  Business
Q&A: China revalues its currency
11 Oct 05 |  Business


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