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Old May 30, 05, 8:31 am   #1
 
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Currencies Linked to the Dollar

I think the thread title states the point - what currencies are linked to the dollar? Also, what currencies (if any) that aren't linked have decent conversion rates now?

I am pretty sure the Thai Baht is connected (as I am going to Thailand this week, I should know) and that the Chinese Yuan is also linked.

Thanks!
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Old May 30, 05, 8:50 am   #2
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thai baht floats.... but the US likes it close to 40

Malaysia fixed (3.75)
Saudi Arabia fixed (37.5)
Cayman Islands fixed too (.8?)
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Old May 30, 05, 9:03 am   #3
 
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Quote:
Originally Posted by aa4ever
I think the thread title states the point - what currencies are linked to the dollar? Also, what currencies (if any) that aren't linked have decent conversion rates now?

I am pretty sure the Thai Baht is connected (as I am going to Thailand this week, I should know) and that the Chinese Yuan is also linked.
The baht is not pegged. I believe that the only Asian nations are China, Hong Kong, and Malaysia, though there are also some that have adopted fixed exchange rates. I am sure a search on google will pop up all the pegged countries. I would guess there are about 50 of them.
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Old May 30, 05, 9:26 am   #4
 
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Several nations in Latin America (namely Ecuador and Panama) and in the Caribbean have pegged their currencies to the US dollar. This website, in fact, has a list of currencies (and exchange rate approximations as of early 2002) for 258 different jurisdictions worldwide.

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Old May 30, 05, 9:28 am   #5
 
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UAE dhirams
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Old Jun 1, 05, 3:35 pm   #6
 
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Yuan revalue?

May I ask a very ignorant question? If the US gets their way and China bends to pressure to revalue the Yuan (allow it to float), where do the experts here feel that will take the conversion rate? Right now it's CNY100 to US$12.08. What might it be under a float? (as best as you can guess)

We are planning an event in Beijing in November and are worried that a revaluation by that time may greatly increase the cost of the event for us. I can't imagine a revaluation making it *cheaper* for us to buy Yuan, I think it would be the other way.

Thanks.
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Old Jun 1, 05, 5:13 pm   #7
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Quote:
Originally Posted by omahajim
May I ask a very ignorant question? If the US gets their way and China bends to pressure to revalue the Yuan (allow it to float), where do the experts here feel that will take the conversion rate? Right now it's CNY100 to US$12.08. What might it be under a float? (as best as you can guess)

We are planning an event in Beijing in November and are worried that a revaluation by that time may greatly increase the cost of the event for us. I can't imagine a revaluation making it *cheaper* for us to buy Yuan, I think it would be the other way.

Thanks.
Even those who argue for increased valuation of the Yuan aren't suggesting a true float. China's financial system is way too fragile for that. The talk is of a series of small steps. I wouldn't expect anything more than a 10% gain vs. the greenback before November.
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Old Jun 1, 05, 6:09 pm   #8
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Re: OP. Malaysia is fixed at around 3.8 and a really great deal for travelers at that. Thailand USED to be fixed around 25 but now floats, most recently in the 38-40 range. It was the breaking of the baht peg 7/1/97 that set off a chain reaction of devaluations across Asia and beyond. Hong Kong is also fixed, as is Macau and China. The dollar also is a second currency in places like Laos and Cambodia that have problems with currency stability.

Also, despite floats in places like Singapore, Indonesia and the Philippines, currencies there haven't gained nearly as much against the dollar as elsewhere in the world because governments keep them restrained to protect exports (the big fear being losing markets permanently to China). If the yuan gets revalued I would expect the others to float more freely and probably rise about as much. You could make a case that the baht, ringgit and certainly Singapore dollar are undervalued.
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Old Jun 1, 05, 6:15 pm   #9
 
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A bevy of Bs: Bahamas and Bermuda are 1:1, Barbados and Belize 2:1.

As far as China, according to last week's Economist, expert opinion is divided. A UBS analyst was quoted saying a minor shift in trading bands or changing from a dollar-only peg to one against a "basket" of currencies was overwhelmingly likely for the near term, with about a one in seven chance of a 5% to 7% rise against the dollar. J.P. Morgan estimated 7%. Goldman Sachs gave 60% odds for a 3-5% revaluation, with a 25% chance of a huge jump of 15-25%. But however much higher the new equilibrium falls, it will be arrived at incrementally.
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Old Jun 1, 05, 6:26 pm   #10
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most SEAsia currencies are defacto pegged, they tend to rise and fall with the USD.

the SIN dollar has managed to do well though, Thai Baht has stayed relatively static since the financial crisis.
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Old Jun 1, 05, 6:34 pm   #11
 
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Hope you are right.....

Quote:
Originally Posted by dhuey
Even those who argue for increased valuation of the Yuan aren't suggesting a true float. China's financial system is way too fragile for that. The talk is of a series of small steps. I wouldn't expect anything more than a 10% gain vs. the greenback before November.
If the US gets the Yuan revalued, presumably the USD$ will fall vs. the Yuan..this will be inflationary.

If the Chinese now have fewer yuan with which to buy USD$, isn't this also going to drive up interest rates (As the US Government will need to pay a higher interest rate in order to sell bonds?)

Am I thinking about this correctly? It seems like a revaluation will increase inflation, drive up interest rates, and pop the housing bubble AT THE SAME TIME?!?!?

OT, I've heard the Chinese currency called both the Yuan and the Renmembi....Yuan sounds like Won (Korea) and Yen (Japan) while Renmembi sounds like Rupee (India), Rupiah (Indonesia) and Ringgit (Malaysia). Is Yuan a Mandarin word and Renmembi is Cantonese?
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Old Jun 1, 05, 6:39 pm   #12
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Quote:
Originally Posted by RustyC
Thailand USED to be fixed around 25 but now floats, most recently in the 38-40 range. It was the breaking of the baht peg 7/1/97 that set off a chain reaction of devaluations across Asia and beyond.
The Thai Finance Minister at the time who spent $4.5Bn trying to prop up the Baht has just been convicted of misuse of public funds and fined the full $4.5Bn he spent.
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Old Jun 1, 05, 7:49 pm   #13
 
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Quote:
Originally Posted by John Galt
I've heard the Chinese currency called both the Yuan and the Renmembi.
I believe the official currency is the renminbi, equal to ten jiao, each jiao being ten fen. "Yuan" is a generic Mandarin term for a currency unit. But to say "yuan" commonly means the renminbi, as when oil is quoted a "dollar" price it is known to mean the US dollar.

While we're OT, "yuan" is related etymologically to the Japanese "yen," but I don't believe it's related to the Korean "won," though all three have historical meanings relating to roundness (as in coins). I do know the Korean equivalent of "yuan" is "bul"; if my grandmother complains that movies are "goo bul" she is complaining they are nine US dollars, certainly not nine South Korean won .
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Old Jun 1, 05, 9:45 pm   #14
 
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Quote:
Originally Posted by choster
I believe the official currency is the renminbi, equal to ten jiao, each jiao being ten fen.
Nope. "Renminbi" just means People's Currency and is the name of China's money, while "yuan" is the base unit of said currency. The Chinese never say "renminbi", "RMB" for their money... but then again, they don't say "yuan" either, it's kuai in normal speech.
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Old Jun 1, 05, 11:02 pm   #15
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Quote:
Originally Posted by John Galt
...Am I thinking about this correctly? It seems like a revaluation will increase inflation, drive up interest rates, and pop the housing bubble AT THE SAME TIME?!?!?...
You're correct in the nature of the effect, but I think you're overestimating its power. China is a big trading partner, but it provides only part of our imports, and despite their importance, imports are less significant to US inflation than the supply and demand of domestic goods and services.

Fewer dollars for China to invest in US securities would indeed mean lower Chinese demand for US debt, but again, this is just one part of a very large, complicated machine. By itself, it would not have a big impact on US interest rates.
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