Chinese depreciation...

Article;
Depreciating Yuan: Is China intentionally engineering a slide in its currency.

Comment;

The fear that Chinese currency will depreciate is too overblown because it is a strong economy with surplus in international-trade and it will not demand the US $ too much which also lessens pressure on the $ to appreciate, demand will increase price will increase. They have enough reserves... Currency is depreciating because of loose money policy. Inflation and depreciation exist with each other, both imply that money-supply was increased for foreign importers, too. Depreciation happens when money-supply is increased, higher supply means lower prices.  Foreign-importers income increases which results in more demand, more goods are supplied, profits increase. So depreciation in Renminbi is supported by fundamentals... Loose money-policy also stoke depreciation. Even when the QE programme was started the US $ depreciated and exports kicked. The Chinese currency will also not depreciate too much because the US will not let that happen. It will worsen the US’ trade-deficit, especially with China, imports to the US will increase. Moreover, it will give Chinese exports advantage over the US’ exports which will not be good for the economy as far as employment is concerned. The US will definitely not let that happen. But inflation and asset bubble points tightening in the Chineses economy. Shadow-banks have pumped so much liquidity in the economy and it is likely that there is a bubble in the real-estate. Tightening will make Renminbi strong and will help the economy deflate bubbles…