Washington has stepped up pressure on Beijing to revalue its currency, boost domestic demand and move to reverse the swelling $201bn (?167bn, ?115bn) US trade deficit with China.

But many economists say that even dramatic gestures by China would do surprisingly little to reverse the imbalance. The impact of currency movements on trade flows, they say, has been dwindling because of ?local cost? pricing, where companies adjust price tags to keep in line with competitors, rather than according to fluctuations in the exchange rate.