In August of 2015 after the Chinese central bank, the People’s Bank of China (PBC) moved to decrease the value of yuan in exchange for the dollar, a column in Wall Street Journal offered this opinion: “China’s trading partners are right to suspect that the real purpose of the so-called reform is a competitive devaluation that boosts Chinese exports and growth at the rest of the world’s expense”. The Republican presidential candidate Donald Trump has made similar comments during the current presidential election, calling the Chinese government a “currency manipulator”.
What does the writer mean by a “competitive devaluations”?
How would such a devaluation boost Chinese exports and growth?
Why would a boost in Chinese exports and growth come at the rest of the world’s expense?
Is there evidence that the Chinese are undervaluing their currency?