RISS expert recalled that in the 1980s, Japan was the main economic rival for the United States. The American economy experienced deficits in foreign trade, balance of payments, and the state budget. A secret meeting of Finance Ministers and Central Bank chairmen of the largest capitalist countries was held in Washington. Under US pressure, they decided to manipulate its currency to cut the dollar rate and increase their national currency exchange rates. Then another secret meeting was held, and there was concluded an agreement on the stabilization of the currency market. As a result, USA managed to reduce the foreign trade deficit with all European countries except Japan. The exchange rate is primarily determined by the price of imported goods, but the Japanese market has lower price sensitivity. "America forced Japan to drastically change its monetary policy. Japan had to reduce trade surplus and increase domestic demand. As a result, Tokyo has been suffering from stagnation and deflation for 27 years," V.Kholodkov explained.
According to expert, it would be difficult for Washington to put serious pressure on Beijing. "In 2015, as a result of China's liberal monetary policy, foreign investors, primarily Americans and Europeans, tried to drop the yuan exchange rate. After that, the Central Bank of China had to spend more than one trillion dollars to maintain the yuan exchange rate. The Central Bank's international reserves fell from $4.1 to $3.1 trillion. But China managed to keep the yuan exchange rate," he said.
He also noted that after the beginning of US-China trade war, Beijin stopped supporting the yuan. Chinese yuan fell to the weakest level against dollar. "US sanctions have led to higher prices of Chinese goods in the American market. But Beijing managed to reduce the yuan exchange rate and prices of Chinese goods in the US market fell again. America is about to taste a dose of its own medicine", RISS expert concluded.