archyworldys

China’s currency falls to record low – central bank under pressure

Chinese yuan

The currency comes in an onshore variant, which is legal tender in China, and an offshore entity, which is traded abroad. Both are currently under a lot of pressure.

(Photo: Reuters)

Beijing, Frankfurt The different strategies of the US and the Chinese central bank (PBoC) are reflected in the exchange rates in Asia: The Chinese yuan fell to its lowest level since the 2008 financial crisis on Wednesday.

By midday, the so-called onshore yuan was trading at 7.2344 yuan per dollar. It is the legal currency used in Mainland China. The offshore yuan, which is traded overseas, also fell sharply.

The Chinese yuan’s “epic weakness” is telling, says Hong Hao, chief economist at hedge fund Grow Investment Group. It reflects the divergence between interest rates in the US and China and the weakening fundamentals of the Chinese economy.

The central banks in the USA and China are currently pursuing different courses. The US Federal Reserve has already raised interest rates five times this year to combat high inflation. Leading US central bankers have also indicated further increases for the coming months.

Tagus Top-Jobs

Find the best jobs now and
be notified by email.

Read on now

Get access to this and every other article in the

Web and in our app free of charge for 4 weeks.

Continue

Read on now

Get access to this and every other article in the

Web and in our app free of charge for 4 weeks.

Continue

Trending