Two reasons for that. First, against the euro and the pound there hasn't in fact been any appreciation. Beijing focuses only on the dollar, because Hank Paulson and the US Congress have seized their attention by talking tough. But the dollar is falling faster against other currencies than the RMB is rising against it. It is up 2% against the euro in the last year. Second, there is no sign of a fall in the Chinese savings rate, still astonishingly high at around 45%.
So these huge imbalances seem likely to persist. And, here, the policy mix - with a fiscal deficit and rising interest rates, seems calculated to make the balance of payments position worse. We'll need an awful lot of flag-waving trade missions led by Digby Jones to make progress against these strong headwinds.