Economics
Roach Sees Currency Wars Just Getting Worse After Yuan Decision
Has China Taken on Too Many Challenges Simultaneously?
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China’s shock move to devalue the yuan risks opening a new front in a currency war that stretches from the euro zone to Japan as nations look to energize their economies.
The People’s Bank of China slashed the yuan’s fixing by a record 1.9 percent on Tuesday, sparking the currency’s biggest one-day loss since the official and market exchange rates were united in 1994. It triggered the steepest selloff among Asian currencies in almost seven years, led by slides in South Korea’s won and the Taiwan and Singapore dollars. The euro and the yen tumbled 18 percent against the greenback in the past 12 months as monetary policies diverged in the U.S., Europe and Japan.