Tag Archives: renminbi

The recent decision by the People’s Bank of China to let the renminbi fall below CN¥7 per US dollar has little to do with trade or currency wars. Rather, it represents an important step by the PBOC toward reforming China’s inflexible exchange-rate regime.… Important because of who is saying it.Project SyndicateThe Renminbi’s Bid for FreedomYu Yongding, former president of the China Society of World Economics and director of the Institute of World Economics and Politics at the Chinese...

For the first time since March 2008, PBOC fixed the yuan weaker than 7 per USD.... Zero Hedge China Fixes Yuan Weaker Than 7 For First Time In Over 11 Years Tyler DurdenSee also at ZHRay Dalio Tells Investors 'Bet On China' As The Next Global Empire

The CNY has already breached 7. The question now is whether China is ready to let drop stand, or even allow the currency float. This article provides background that most Western articles announcing the move don't. China has apparently decided to pursue its national interest rather than let the exchange rate dominate policy.SCMPIs China about to let the yuan weaken below seven to the dollar? Also relevant Sputnik International'Chinese Will No Longer Give Priority to Controlling Trade...

When is China going to follow Russia and float? We argue that policymakers in China are now going to be more accepting of USD/CNY appreciation through 7: years of regulatory measures should make outflows more manageable, easier monetary policy will add upside pressure and a weakening FX is the natural means of offsetting tariffs.... Zero HedgeSomething Just Broke In The Chinese YuanTyler Durden

China needs to keep growth high enough to maintain social stability, but also must preserve external stability via the renminbi’s exchange rate. How China manages its currency during its economic policy shift could have important global consequences. China is not sovereign in its currency since it pegs to the dollar. Currency sovereignty requires floating the rate whereas as peg sets a fixed rate. This means that China domestic policy is constrained by have to manage the exchange rate...

The vast majority of economists believe that the Fed's asset holdings keep down U.S. interest rates. It is inconsistent to believe that the Fed's holdings of U.S. assets keep down interest rates here, but China's holding of foreign assets does not keep down the value of its currency. Beat the PressDoes China's 2.5 Percent Inflation Rate Really Explain the Decline in the Value of Its Currency Against the Dollar?Dean Baker | Co-director of the Center for Economic and Policy Research in...

Germany looks to the future. Uncle Sam won't be pleased. HSBC chief executive Stuart Gulliver, speaking at the same conference in Hong Kong, said that the Belt and Road Initiative (BRI) will increase the usage of RMB even further. China’s central bank announced new measures earlier this month to encourage cross-border yuan transactions in support of BRI projects. Asia TimesGerman central bank to add RMB to currency reserves: Follows ECB’s move to include China’s currency last year

Perhaps another way of putting this is that SDR inclusion is a commitment device. In addition to the practical concerns raised by Zhou, there would also be reputational costs to reversing exchange-rate and capital-account reforms. Since SDR inclusion is contingent on the IMF’s determination that the renminbi is “freely usable,” it could conceivably be reversed if the currency were to stop being freely usable. What future Chinese central bank governor will want to see headlines screaming...