China Yuan Devaluation After IMF Letdown Screams Buy Dollars
ByChina’s decision to devalue the yuan is good news for dollar bulls.
China’s central bank cut the yuan’s daily fixing rate by a record 1.9 percent Tuesday after the International Monetary Fund last week delayed a decision to endorse it as a reserve currency. TheMOVE
cast doubts on the health of the world’s second-largest economy, weighing on the currencies of its trading partners and competitors.
“Given that the Chinese economy needs some kind of release valve, with the postponement, they will probably use this as an excuse to let the yuan drift lower,” said Nudgem Richyal, a senior fund manager in Singapore at J O Hambro Capital Management, which manages more than $20 billion. “For the dollar, there is probably more reason to own it. For the global economy, it probably adds more disinflationary pressure.”…
China Yuan Devaluation After IMF Letdown Screams Buy Dollars
