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CHINA REVALUES

(Friday, July 22, 2005)

Yesterday China revalued its currency by an incremental amount. It left the door open for further limited incremental amounts. At the moment, the amounts would be subject to a percentage change on a daily basis. These percentage changes could accumulate over time.

Also, the Yuan would no longer be pegged to the U.S. Dollar but rather the currency would be targeted at a basket of currencies.

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