主题：吴晓灵：中央银行现在已经处于两难状态 -- SkyWalkerJ

In short: when capital movement is free or actually free(China's case) and nation A and B have fixed exchange peg, credit is determined by the central bank with the lower interest rate.

Put it simple: China has lost its monetary policy independence. Period. USD is the global reserve currency and America is abusing this status and pouring inflation into China, a would-be-Japan.

That's common sense and the bloody lesson learned by Europeans in 1970s.

Germans hated inflation more than mark appreciation, that's how they avoid importing inflation from America.