Posted on 09/26/2019 11:40:41 PM PDT by cba123
BEIJING/HONG KONG (Reuters) - China, having let the yuan cross the once sacred red line of 7 per dollar, will allow its currency to fall further and may even risk U.S. anger by using it as a bargaining chip in already thorny trade talks, market participants believe.
Beijing had kept the yuan on the strong side of 7 since 2008, so effectively abandoning that trading floor on Aug 5 triggered intense investor activity.
The currency's 3.8% decline in August as a whole was its sharpest monthly fall in 25 years, prompting U.S. President Donald Trump to launch a fresh salvo in the more-than 15-month tariff war by labelling China a currency manipulator.
(Please see link for full article)
(Excerpt) Read more at mobile.reuters.com ...
-- Chi Lo, senior economist at BNP Paribas Asset Management, said that while Beijing had never sought to devalue the currency and had no targets for it, an escalation in the trade war could push it as low as 7.5 per dollar.
That might serve China well, he said.
"If the Chinese are successful in inflicting pain on the U.S. stock market... that will be a way to force Trump back to the negotiation table and hammer out some compromise."
Trump, stand up for America.
For real. 25% tariffs are micky mouse.
Raise them to 100% next.
(Article link)
https://mobile.reuters.com/article/amp/idUSKBN1WC05T
Wow, sounds like Trump is up against the mafia. Imagine if he was able to do his job unobstructed.
Any trade progress is dead for the time being given that the Rats are going to proceed with the impeachment - they’ve trapped themselves into that course - now that they’ve thrown this bloody meat to their rabid hyenas, they would be literally mauled by that mob if they pulled it back.
China is going to wait it out and see what happens rather than yielding any ground. Who can blame them?
China hurts itself and helps pay for the tariffs when it lets its currency devalue.
They are loaded with dollar denominated debt.
If the Yuan is allowed to fall much farther it will mean they don’t have the ability to keep it high.
Trump should raise tariffs periodically to compensate but he should do it incrementally to avoid any shocks to our economy.
China is doomed.
Whatever goal China had in making its currency a fold standard for nations to settle deficits in Asia, it is now being destoryed.
This means Vietnam, India etc.. will be using dollars and be freeed from Chinese silk and road promises.
This is a very good thing.
The Yuan is a sht debauched currency anyways, its value was always artificially propped to compete and take over and corrupt the Honk Kong dollar. This will reinforce Hong Kong’s position too imo.
It is a fine line they walk, devaluing currency tends to pick up steam on its own.
China devaluing their currency hurts them while helping US consumers.
The trade war is being financed by China.
US consumers don’t see any impact. That’s good. Keeps political pressure off the President.
Companies are not making as big of profits and have uncertainty in China as a manufacturer of their products so they move elsewhere.
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