Greg Ip reports in today's Wall Street Journal (page A2 in the print edition):
Federal Reserve Chairman Alan Greenspan said China will unpeg its currency from the dollar "sooner rather than later" because the policy poses a growing threat to China's own economy.
The Fed chief is the latest U.S. official to turn up the volume on China, which has kept the yuan pegged to the dollar at a level many in the U.S. consider artificially low. President Bush and Treasury Secretary John Snow also have recently pressed China to loosen the peg, and some lawmakers have gone so far as to ask for trade retaliation for what they consider the unfair advantage the low currency gives Chinese exports in the U.S. market.
Mr. Bush's nominee for trade representative, Rep. Robert Portman, told another Senate committee yesterday that he plans to take an aggressive stance toward China...
Mr. Greenspan told the Senate Budget Committee that China's peg "is beginning to significantly work to the detriment of the Chinese economy." (Full text)
UPDATE: No sooner do I post, than I discover that Kash has much to say on the topic: Here and here. You have to get up early to scoop the boys at Angry Bear.
UPDATE FROM ROUBINILAND: Nouriel takes a deeper look, and concludes that he and the Chairman on the same page. Great post -- have a look. (However, I must reiterate that my views do not represent those of the Federal Reserve System, unofficial or otherwise.)
I guess they are not listening to Nouriel Roubini.