International financial management Essay Example | Topics and Well Written Essays - 2000 words

International financial management - Essay Example Currently Chinese Yuan is fluctuating around 6.3 per US Dollar showing a stronger Chinese Yuan as compared US Dollar. Overall, it can be concluded that Chinese Yuan became stronger against US Dollar in past 5 years as it became stronger by CNY0.8 approximately 11.26%. From last 2.5 years, Chinese Yuan has been constantly appreciating against US Dollars. The above chart represents USD/CNY for the 12-month period starting from March 1, 2012 and ending on February 28, 2013. Exchange rate was at CNY6.3 at the beginning of the period and it was at around CNY6.29 at the closure of 12-month period. Overall the Yuan remained quite stable throughout 12-month period and appreciated by only CNY0.01 which is approximately 0.15%. If the above graph is closely looked at, it can be noticed that in the first seven months, Chinese Yuan tended to remain weaker as compared to US Dollar such that several times it touched CNY 6.34. On July 27, 2012, Yuan was found to be the weakest in the whole year such that it climbed up to around CNY 6.39 which was the highest exchange rate in the whole year. Since then Yuan remained a bit flat around the level of CNY 6.34 till October 2012. After that there has been a considerable appreciation observed in Chinese Yuan such that it broke the psychological level of CNY6.3 in mid-October and tend to remain stronger ag ainst US Dollars. It sharply strengthened on December 1, 2012 such that it came to the level of CNY6.22 reaching at the lowest point in the year 2012. However it was a very temporary downfall of US Dollar against Yuan such that Yuan got weaker from the very next day it crossed the level of CNY6.3. The current year i.e. 2013 started with appreciation of Chinese Yuan against US Dollar such that it appreciated tremendously in daily movements on January 17, 2013 as it broke up the level of CNY 6.204 and reached to the bottom of CNY6.218. However, the