Following the announcement of reciprocal punitive tariffs, China could take the next step in its dispute with the US and devalue its currency.
Beijing In the trade dispute with the US, China is investigating a devaluation of its currency yuan, according to insiders. Leading officials examined this possibility both as a means of pressure against the rival as well as to alleviate the consequences of the conflict, reported the news agency Bloomberg on Monday with reference to persons familiar with the matter.
However, this does not mean that the instrument will actually be used. China's central bank initially did not want to comment on the statements.
The yuan fell in the currency market and dropped to its lowest level in two weeks. US President Donald Trump repeatedly accused China of artificially weakening the course during the election campaign. Beijing wants to give its own export industry advantages by correspondingly falling prices for exported goods on the world market. Trump was the last to leave this reproach.
For some time now, China has artificially strengthened its currency rather than weakening it.Unlike the euro or the dollar, the yuan is not fully subject to market forces, but can fluctuate freely over a daily benchmark only within a given range.
