Our index suggests that a fair-value rate would be 3.54 yuan to the dollar, compared with the current rate of 6.78.
While any investment in a pre-Phase II company is high risk and speculative, we initiate coverage with a buy rating and fair value range of 9p-10p.
Leo Doyle, an economist at Dresdner Kleinwort Benson, thinks that sterling's "fair value"—the exchange rate consistent with a zero current-account balance and output equal to the economy's capacity is about 75p to the euro; a year ago, he put it at 78p.All of this raises another question: at what rate might sterling eventually join the euro?
While there was brave talk that a rate of 8 pesos to the dollar was fair value, the black market rate is more like 13.
But Friedman argued that, provided sensible policies were followed, speculators would act as a stabilising force, preventing currencies from departing too far from fair value.In fact, exchange rates have been more volatile than Friedman might have expected.
It also alleged that Chinese firms were selling goods at rates below fair value, a practice know as dumping.
In its latest report, the Department of Commerce concluded that Chinese firms were selling products in the US at rates below fair value, a practice know as "dumping".
My conflicted heart The ironing lady Joined-up thinking ReprintsThe most common method for judging a currency's fair value is to estimate the exchange rate needed to bring a country's current-account imbalance to a "normal" level.
We have a neutral rating and 550p fair value.
Earlier this week, Goldman Sachs reiterated an "outperform" rating and $40 fair value estimate for GE, saying there shouldn't be any surprises in the company's fourth-quarter results or material changes to 2005 earnings-per-share guidance.
Goldman Sachs reiterated an "inline" rating and $21 fair value on VeriSign, saying the decision to sell its payment gateway unit to eBay should help streamline VeriSign's overall business.
