Is The Yuan Headed For A New Low Vs. The U.S. Dollar?
Mike (Mish) Shedlock | Jun 13, 2016 12:06AM ET
The rally in the yuan which ran from January through mid-March has mostly been erased. If the yuan continues to sink, protectionists in the US will howl.
Included in the protectionist group are Donald Trump, President Obama, Hillary Clinton, and Bernie Sanders, to varying degrees. Trump is the leader of the protectionist group.
Yuan Falls Most in Two Months
Bloomberg reports Yuan Falls Most in Two Months as Trading Resumes After Holidays .
The yuan headed for its biggest loss in two months as the currency traded for the first time since Wednesday.
The yuan lost 0.4 percent to 6.5879 at 10:04 a.m. in Shanghai, approaching a five-year low against the dollar. A gauge of the greenback’s strength climbed 1.1 percent when mainland markets were closed for holidays. The central bank set the reference rate 0.3 percent weaker.
“There is a high chance the yuan will break the January low,” said Wang Ju, senior foreign-exchange strategist at HSBC Holdings. “The fundamentals for the yuan are weak: the economy is slowing and capital is flowing out of China.”
Yuan vs. US Dollar
Get The News You Want
The yuan is down about 8.5% since 2014.
With the exception of countries whose currencies are in trouble such as Brazil, Venezuela, Russia, and now China (the latter to stop capital flight), it’s difficult to find countries that believe a rising currency is a good thing.
Trump is seriously wrong when it comes to free trade, but that issue may very well win him the election.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.