Analysts at Societe Generale offer their thoughts on the recent Yuan weakness and next direction in the coming days.
Key Quotes:
“USD/CNY in the past week is “clearly a trial balloon” (in response to trade threats).
Too much depreciation could be counterproductive.
And also counterproductive to China’s internationalization objectives – attracting foreign equity/bond capital.
Highlight the risk here, though, in 2015-16, a consolidation phase ensued following upward moves in the range of 3.5%-5%.”
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