The movement in the Chinese currency (the yuan) in January 2008 is equivalent to about a 16% rise on a yearly basis, analysts have already begun to forecast that the Chinese currency could rise up to 9% by the end of the year.

Economic growth in China for 2007 is expected to be reported around the 11.5% mark, with much of that growth coming from cashed up exporters who have invested money into chinese assets.

Beijing is becoming increasingly concerned about domestic inflation, and for good reason, with an 11 year high hit in November 2007. Regulators are concerned that too much money in the financial system is causing the economy to overheat. With cheap Chinese exports far outweighing expensive imports, experts argue that an undervalued exchange rate is the cause of the excess liquidity problem.
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With over $1.2 trillion being traded every day it is easy to say that the Forex (Foreign Exchange) Market, is the largest market in the world. In fact this figure represents more turnover than all the world’s stock markets combined. When trading forex the currency of one country is traded against another. The exchange rate is the rate at which they are traded. Trades can be executed through a financial institution or broker through the phone or internet. Forex has only recently been made available to small traders with the invention of the internet and is a growing market. In 1997 there were only 1.7 million trading accounts compared to more than 6 million today.
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