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Shuli Ren

Don't Rule Out a Yuan Devaluation

China needs to keep some ammunition in case of any escalation in the Trump trade spat.
chinese currency (yuan) and devaluation graph on the rustic chin
Illustration: iStock/Getty Images
Updated on

Don't relax yet: A potential yuan devaluation is still very much on the table. 

Currency traders sighed with relief Tuesday after Chinese President Xi Jinping moved to ease trade tensions with the U.S., reiterating pledges to open the country's economy further and cautioning against a cold-war mentality and zero-sum thinking. The yuan had weakened for the four previous days, with jitters exacerbated by a Bloomberg News report on Monday afternoon that China is studying the potential impact of a gradual depreciation. It climbed 0.3 percent as of mid-afternoon Tuesday.