China should worry less about its currency

IT IS EASY to forget that the world’s second-biggest economy is still an emerging market. China’s global clout, its technological prowess in certain fields, and even its low bond yields all distinguish it from the typical member of its asset class. But in at least one respect China resembles a classic emerging market: it retains a palpable fear of floating its currency. Instead China keeps a close eye on the yuan’s value against the dollar and a basket of its trading partners’ currencies, limiting any sharp movements.