{"id":76652,"date":"2015-08-11T00:47:06","date_gmt":"2015-08-11T04:47:06","guid":{"rendered":"http:\/\/countingpips.com\/?p=76652"},"modified":"2015-08-11T05:14:10","modified_gmt":"2015-08-11T09:14:10","slug":"yuan-slips-to-three-year-low-after-pboc-devaluation","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2015\/08\/yuan-slips-to-three-year-low-after-pboc-devaluation\/","title":{"rendered":"Yuan slips to three-year low after PBOC devaluation"},"content":{"rendered":"
August 11, 2015<\/div>
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Article by ForexTime<\/a><\/p>\n

The Chinese yuan sharply weakened to a three-year low on Tuesday after the country\u2019s central bank surprisingly devalued it, dragging down the Australian dollar and adding a potential element of volatility to the region\u2019s foreign exchange markets.<\/p>\n

In an attempt to make the country\u2019s exports more competitive and prop up the economy after recent poor data, China\u2019s central bank devalued the yuan by nearly 2 percent on Tuesday.<\/p>\n

The yuan midpoint was set at 6.2298 per dollar, compared with the 6.1162 mid-point on Monday, with the central bank to now base the yuan\u2019s midpoint on market makers\u2019 quotes and the previous day\u2019s closing price. Spot yuan plunged roughly 2 percent to as low as 6.3360, weakest since September 2012.<\/p>\n

\u201cThe yuan had become relatively expensive as other Asian currencies weakened against the dollar. With fears of an economic slowdown mounting, devaluating the yuan was the only thing China had not tried after implementing monetary, fiscal and equity-boosting policies,\u201d said Masafumi Yamamoto, senior strategist at Monex in Tokyo.<\/p>\n

\u201cDevaluation of the yuan likely won\u2019t end here. Currencies like the Singapore dollar, South Korean won and Taiwan dollar, which stand to compete with China, are falling, and today\u2019s move could generate headlines heralding the start of a devaluation war,\u201d he said.<\/p>

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The Chinese central bank currently allows the yuan to move 2 percent on either side of its fixed mid-point.<\/p>\n

\u201cI\u2019d say it\u2019s a welcome, rather overdue move towards a market-determined exchange rate. It surely marks the end of the presumed SDR-driven stability and highlights that the July export numbers were just too weak to ignore,\u201d said Sean Callow, senior currency strategist at Westpac in Sydney.<\/p>\n

The Australian dollar lost 1 percent to $0.7338 AUD=D4, giving up earlier gains made on a rebound in commodity prices. The Aussie is often used as a liquid proxy of China trades.<\/p>\n

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\"Forex-Time-Logo\"Article by ForexTime<\/a><\/span><\/strong><\/p>\n

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Article by ForexTime The Chinese yuan sharply weakened to a three-year low on Tuesday after the country\u2019s central bank surprisingly devalued it, dragging down the Australian dollar and adding a potential element of volatility to the region\u2019s foreign exchange markets. In an attempt to make the country\u2019s exports more competitive and prop up the economy […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-76652","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/76652","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=76652"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/76652\/revisions"}],"predecessor-version":[{"id":76664,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/76652\/revisions\/76664"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=76652"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=76652"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=76652"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}