Goldman's Cohn Says China Will Probably Have to Devalue Currency

Hard Landing Ahead for China? Gary Cohn Doesn't Think So

China will probably have to devalue its currency to address slowing growth in the world’s second-largest economy, Goldman Sachs Group Inc. President Gary Cohn said.

QuickTake The People’s Currency

“They may have to do something in the next six months,” Cohn said Friday in an interview on Bloomberg Television at the World Economic Forum in Davos, Switzerland. “Do I believe they will end up devaluing the currency? I do.”

The Chinese government has no intention and no policy to devalue, China Vice President Li Yuanchao, who is also a member of the party’s Politburo, said in a Bloomberg interview Thursday.

The comments by the Chinese vice president on the yuan follow a volatile start for the year, which began with an unexpectedly large reduction in the reference rate in onshore trading in China. The currency dropped 1.5 percent in the first week of January, stoking concern about policy intentions.