That makes goods produced in those countries more expensive compared with China's.
"If you have one large economy in Asia lock itself against the U.S. dollar, everyone feels pressure," says Frederic Neumann, Asia economist for HSBC in Hong Kong. "Even 5% in this context feels painful."
The countries that compete with China are at a critical juncture. To stem the rise of their currencies against the yuan (and the dollar), central banks around Asia have in recent months been purchasing gobs of greenbacks and building their foreign reserves. And now those reserves are back up to precrisis levels.
At the same time, Asian economies are under pressure
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