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In an overnight interview on Bloomberg Television, Goldman Sachs’ Zach Pandl, Co-Head of Global Foreign-Exchange and Emerging-Market Strategy in New York, expressed his thoughts on the US-China trade issue and his view on the Chinese yuan going forward.

Key Quotes:

Case to be long yuan is really about the prospect of a tariff rollback in the U.S.

If we do get confirmation of a rollback of some of the tariffs, we think that the yuan could have a relatively sharp but short-lived period of appreciation into the first quarter. it is one of our favorite FX trades.

U.S. may request more openness from China about its currency policy as part of a trade deal

That’s not really what’s driving the yuan at the moment, so we don’t think it’s a major issue for the trade talks.”