Yuan Weakness Does Little to Spur Pessimism in Forwards: ChartBy
Financial markets from Chinese shares to Asian currencies are so far unfazed by the yuan’s decline to a 2010 low as central bank policy becomes more transparent. The lack of alarm is reflected in 12-month non-deliverable forwards, whose discount to the spot rate has narrowed even as the exchange rate extended its decline for the year to 3 percent. The monetary authority’s improved communication with the market will help contain expectations for weakness and mitigate the impact on equities, according to UBS Group AG.
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