Soros, who runs a hedge fund Soros Fund Management and has long earned a reputation as a bold player in the foreign exchange market, finds it necessary to reduce the U.S. dollar against Chinese currency to the United States to curb its budget deficit. The investor believes that the Chinese currency is undervalued, and this affects the depreciation of the dollar against a basket of major world currencies. He stated this at an event organized by the Economist magazine on the Stock Exchange of New York, reports Reuters.
Meanwhile, the undervalued yuan makes Chinese goods cheaper for consumers in foreign markets. Beijing seeks economic growth in the country, making the target for its exports of consumer markets in many countries. National producers in these markets can not compete with the Chinese, including those due to exchange rate differences.
Soros said that the globalization of financial markets was based on "false representations" that they can be left to themselves. According to the investor, is currently a need for new global rules for the global financial system.
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