Think tank predicts 5.7 yuan to the dollar by 2017

Beijing think tank West Brothers Economic Institute said that the renminbi will appreciate by nearly 10% by 2017, Caixin reported. During the five-year period, the institute predicted that the yuan will rise to 5.7 against the dollar. The currency is valued at 6.3 yuan to a dollar. The forecast is premised on an anticipated 7.5% annual growth rate in China, coupled with 2% growth per year in the US. Since exchange rate liberalization in 2005, the yuan has gone up vis-a-vis the dollar by 32%. During that time period, China’s GDP has grown 123%, significantly faster than US growth of 11%. The figures indicate the yuan still has the capacity to greatly appreciate. The difference in the countries’ rates of expansion means the yuan has the potential to increase more than 100% against the dollar, the institute said.