Advancing a Free Society

China Brings Renminbi Banking to the United States

Wednesday, January 12, 2011

China has announced that residents of New York and Los Angeles will be able to open deposit and business accounts in renminbi (China’s currency).  Individuals will be able to purchase CDs of six months or one-year duration, or make cash deposits of up to $4,000 a day and $20,000 a year at Bank of China branches in the U.S., which will be covered by FDIC guarantees.

Some critics say that this new policy is a trivial change, and fails to liberalize the exchange rate of the renminbi to permit greater appreciation to the satisfaction of the U.S. government.  But this perspective misses the point.

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