Obviously, the other graph. If you peg the value of your virtual dollar to the real Euro, they will move the same.
However, what the smoothness of one curve and the rhapsodic nature of the other tells me is that China closely manages the appreciation of the renminbi relative to the US dollar, and largely but not totally ignores the Euro. I.e. they bend to US demands, but not to an extent that the price advantage against Europe doesn't increase. *Lunatic*, n. One whose delusions are out of fashion.
The smooth devaluation to the USD and spikiness to the Euro suggests that they are leaving the USD dominant in the peg and shifting the peg, but having the Singapore peg leaves them free to reduce the weight of the USD in their peg at any time.
Since the average valuations are heading in exactly the direction of the opportunity I pointed out earlier this year, allowing the USD rate to rise to lean against imported commodity price inflation, but not so far as to increase the valuation of the Yuan/Renminbi against the Euro, it would seem that the make up of the basket of currencies has a political benefit. If the US complains about the trade deficit, they can say, "but the yuan is revaluating against the dollar", while if Eurozone nations complain about the trade deficit, "but, that's just the float against the dollar ... we are revaluing against the dollar, but we can only go so fast if we are going to avoid economic distress". I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.
