Analysts Say PBOC Will Let Yuan Slide Past Key Threshold of 7 Per Dollar
- Trade-weighted yuan has remained strong even as dollar jumped
- Desirable for China to manage FX expectations: Credit Agricole
China’s currency slipped to a two-year low of 6.923 Monday and ended August with a decline of 2.2%, a sixth month of losses.
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The yuan is set to slide past 7 per dollar with scarcely a murmur as a range of metrics show the currency would still be relatively expensive against its non-dollar peers, analysts say.
The authorities will allow the currency to weaken past that key psychological barrier and merely seek to prevent a rapid decline that may cascade into a disorderly selloff, according to Societe Generale SA and Barclays Plc, among others.