During a joint press conference at the White House on Friday, September 24, 2015, Chinese President Xi Jinping said China's economy is in transition from "speed growth" to an economy driven by consumer demand.
Since July 30, China's currency, the yuan has depreciated against the dollar by more than five percent, largely because of Chinese government intervention, according to California's Legislative Analyst's Office. The bipartisan office notes that the yuan's depreciation could make it more expensive for Chinese consumers to buy American-made and California-made products.
However, California imports far more from China than the state exports. The depreciation likely will reinforce this trade imbalance with China. California consumers may benefit from this as the strong dollar could lower the cost of imports.
During President Obama's joint press conference at the White House with China's President Xi, the Chinese leader noted the devaluation in August was "due to the infliuence of factors such as previous strengthening of US Dollar" and said there is "no basis for RNB to have devaluation in long run."
"We are taking prudent measures to stabilize growth and promote reform. We manage to maintain seven percent growth rate in the first half of this year," he said.
President Xi expects to see similar growth rate maintained for all of 2015.
He noted that China's economic fundamentals have not changed and remarked that the income of most citizens is in what is termed a "middle income period" when countries transition from a developing economy to a strong trading power.
President Xi described China as moving to quality based growth that is driven by domestic demand and consumption. Urbanization continues to impact the country's economy with an annual urbanization rate of two percent, the equivalent of about 10 million people moving from rural areas to urban areas.
"Going forward," said President Xi, "China will provide healthy growth that strengthens confidence."
President Obama acknowledged his support, saying, "A successful and stable and peaceful China can be a partner with us on a range of issues. As powerful as the US is, the things we face like climate change or terrorism or refugees are not issues any one nation can solve."
The recent weakness in China has contributed to lower oil prices worldwide, as evidenced by gas in the Los Angeles area dipping to $ 2.99 per gallon. That's good news for drivers, but not so good for oil-producing Kern County where the budget is heavily dependent on property taxes, and oil companies account for about 22 percent to one-third of the total amount.
On Monday, President Xi will give a speech to the UN General Assembly in New York.