China’s Dream of ‘Powerful Currency’ Runs Into Trump’s Return
- Trade war risks have fueled yuan short bets after US election
- Some analysts expect CNY to fall as much as 10% against dollar
The yuan is more vulnerable than it was during the last trade war.
Photographer: Paul Yeung/BloombergThis article is for subscribers only.
China’s President Xi Jinping wants a “powerful currency” that is stable enough to play a rising role in global trade. Donald Trump’s return looks set to challenge that ambition.
The yuan risks years of downward pressure during the second Trump presidency, and the threat of another trade war is already fueling bets against the currency. Analysts expect the yuan to break a 17-year low against the dollar in 2025, with the most bearish observers predicting a decline of around 10%.