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China Watchers Split on Yuan Outlook; It Comes Down to Trade

  • Biggest bull sees it rising to 6.25 and top bear predicts 7.4
  • Most forecasters missed the magnitude of yuan’s 2018 slump
Stocks Boards And Chinese Yuan Banknotes As China Devalues Yuan By Most In Two Decades
Photographer: Tomohiro Ohsumi/Bloomberg
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After missing this year’s slump in the yuan, forecasters for the Chinese currency are split on the outlook in 2019, thanks largely to the sharply divergent outcomes from U.S.-China trade talks.

Since the yuan’s four-year run of appreciation against the dollar ended in 2013, it has been tough to predict, thanks to shifting prospects for China’s economy as it decelerated and to sometimes unexpected policy moves by the country’s opaque leadership. This year, the largely flat outcome that analysts had expected was upended by President Donald Trump’s move to start a trade war between the world’s two largest economies.