China-Japan Currency Deal Points Way to New Monetary Order: View
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Dec. 29 (Bloomberg) -- The agreement announced betweenChina and Japan to strengthen financial ties and promoteyuan-yen trade is a small, but notable, step toward a newglobal economy. Its immediate practical significance islimited, yet the deal signals that a deeper transformationis under way -- and one that the world should welcome.
The plan was a surprise: It marks a warming ofrelations that had been chilly of late. The accord stilllacks a timetable for implementation, but once in force itwill let Chinese and Japanese trading companies switchbetween yuan and yen without converting to dollars first.This will encourage commerce by reducing currency risk andtrading costs.