according to How a currency war can help China neutralise US tariffsMoneycontrol NewsOn March 1, Donald Trump raised the import tax on steel and aluminum, firing the first shot in what could be a protracted trade war. Therefore, triggering a currency war will only be to the benefit of China since exports will become more competitive, driving up volumes. What is the downside of currency devaluation? Stockpiling foreign currency serves as an effective bulwark against capital flight. A country's forex reserves comprise of the foreign currency held by its central bank.
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China has its currency to use as a weapon in trade war with Trump
China's currency fell to a near 11-month low against the dollar Wednesday, after the Trump administration fired off a new list of tariffs on $200 billion in Chinese goods. China's currency has been sliding noticeably since mid-June after bumping around at higher levels from February through May. China's currency has been a sore point for a number of U.S. administrations, which have blasted China for allowing the renminbi to weaken to help exports. That would be commensurate with the trade shock we've seen," he said. UBS Global Wealth Management also said Wednesday that the Chinese currency could weaken to 6.8 yuan per dollar.China's yuan plunges again. Is a currency war coming?
as informed in China's currency is plunging again. Analysts said the yuan's latest dip came after China's central bank indicated that it was willing to accept a weaker currency. Instead, China's central bank — the People's Bank of China — helps guide the currency by setting a daily trading range. Related: China's yuan is weakening against the dollar. Related: China's economy shows signs of slowing.collected by :Mathio Rix