China did USA an ill turn?

China's trading partners have welcomed its long-awaited currency revaluation, but analysts believe it is bad news for the U.S. dollar and exchequer bonds, says

Reuters called China's decision a modest move which is unlikely to end diplomatic tensions over a range of issues from booming exports to Beijing's military rise.

Federal Reserve Chairman Alan Greenspan said Thursday's revaluation was a "good start", and U.S. Sen. Charles Schumer - among those pushing to punish China with stiff tariffs if it did not revalue - called it a "baby step," adds Reuters.

As a practical matter, the 2 percent rise in the value of the yuan is far too small to make a dent in the $160 billion trade deficit the United States runs with China, believes The Boston Globe. "Symbolically, this is a very important move," The Globe quoted Bill Cheney, chief economist at John Hancock Financial Services, as saying. Like other analysts, Cheney believes yesterday's baby step will be the first of a series of revaluations that, over time, could increase the value of the yuan by a significant amount.

Meanwhile, crude futures rose Friday in an early flurry of Asian activity after China's decision to abandon its currency peg to the U.S. dollar, a move that will likely make dollar-denominated oil prices cheaper for China, the world's second-largest consumer of crude, reports the AP.

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