The Currency Crash Caused Global Problems.
In recent days, the devaluation of the renminbi has triggered a violent upheaval in the global market. The reason is that the weakening of the RMB has affected China's supporting role in promoting global economic growth.
The depreciation of the renminbi will not only weaken the purchasing power of China's largest buyer in the world, but also have a significant impact on the newly emerging economies and the developed countries.
The credibility of this devaluation is not high.
Greg Anderson, head of monetary policy at BMO Capital Markets, said that China would not allow the renminbi to depreciate further, and the depreciation rate of 10% would be less realistic. "Greg"
In addition, more than 10% of the depreciation rate will not bring benefits to China. A greater depreciation will lead to market turbulence and dissatisfaction among various countries. Japan and other countries will follow China's currency.
depreciation
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Therefore, some analysts said that slowing the pace of devaluation of the renminbi is the best choice for the Central Bank of China.
Impact on developing countries:
The depreciation of the renminbi not only weakened the demand for commodities and imports, but also depressed the prices of oil and other industrial commodities, and exported copper and oil to China.
emerging market
Economies were then affected, including Brazil and Chile.
The Baltic dry bulk index (BDI), known as the "weathervane" of commodities, has been refreshed again after this Tuesday.
Western analysts believe that the start of the new year's tragic start.
International copper prices fell for the first time in 2 years in 7 years, while the Bloomberg global mining index fell to its lowest level since 2004.
Impact on developed countries:
RMB appreciation
depreciation
The impact of China's perceived growth as a core growth market has been significantly affected by the developed countries, including Germany.
The German DAX index fell 2.29%, continuing the decline since the start of the new year, with a total decline of more than 7%.
The already low inflation rate is further constrained by the weakening of commodity prices.
If the yuan continues to depreciate, or will lead to currency wars between countries, countries will compete to devalue currencies to protect export enterprises.
As the economy slows down, the Chinese government tries to pform its economy from export-oriented to domestic demand, which makes the current economic situation more complicated.
On Thursday, Reuters quoted sources as saying that the Central Bank of China is facing increasing pressure from authoritative government economists. Policy advisers hope that the renminbi will depreciate at a faster and larger pace, with a maximum depreciation rate of 10%-15%, because the recent gradual devaluation is considered to be more harmful than benefits.
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