SocGen’s Anne Says Yuan May Weaken After Trading Band Change
The yuan may weaken following China’s decision to widen the currency’s trading band for the first time since 2007, according to Benoit Anne, the London- based head of emerging markets strategy at Societe Generale SA.
He spoke in a phone interview today.
On a weaker currency:
“The markets may take this move as a disguised way of easing through a weaker currency. A widening of the band is not a guarantee that the yuan is going to go stronger. Right now I think the balance of risks is that the currency will swing the other way.”
On market impact:
“If the market interprets this as an accommodative move, ultimately that’s positive for risky assets. If you allow your currency to weaken a bit, this is positive for the economy. It’s probably good for equities and commodities and emerging-market assets.”
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