China's economy heats up, spurring housing market concerns; Bloody clashes in Jakarta; Obama says Israel-Palestine impasse is "costing" US; BRIC leaders gather in Brazil; and more
Top of the Agenda: China's Growth Adds Pressure to Revalue Currency
The Chinese economy grew 11.9 percent in the first quarter of 2010 compared to a year ago, supporting the global economic recovery but raising concerns about overheating (FT). It was the fastest growth rate in nearly three years, exceeding economists' expectations and adding pressure on China to raise interest rates and let its currency appreciate. Yesterday, concerns rose about a potential bubble in the housing market when the government announced housing prices increased 11.7 percent in the past year, the fastest rate in five years. In March, China tightened bank lending to reduce the massive stimulus measures it implemented following the economic crisis.
China's Commerce Ministry promptly announced its opposition to yuan appreciation (Reuters). A spokesman said the United States was wrong to argue that Beijing was giving Chinese exporters unfair advantages and contributing to US unemployment by undervaluing its currency.
Analysis:
On the "Daily Beast," Gordon Chang says China's increasing reliance on the American market means it will continue buying US debt.
In the Washington Post, Arthur Kroeber offers five myths about China's economic growth.
Background:
This CFR Backgrounder examines the China-US economic imbalance.
PACIFIC RIM: Jakarta Protesters Decry Security Forces
Hundreds of Indonesian protesters gathered in Jakarta demanding that the public security force be disbanded after bloody clashes between police and demonstrators left three dead and at least 156 wounded (TimesofLondon).
Read CFR's Asia Unbound blog, featuring timely analysis from CFR's Asia experts.
ELSEWHERE:
Obama to Shift Israel-Palestine Approach
US Leaves Afghan Korengal Valley
BRIC Countries Meet in Brasilia
This is an excerpt of the CFR.org Daily News Brief. The full version is available on CFR.org.