China is ready to slow yuan descent
Chinese policymakers have been generally unfazed by the yuan's recent slide, though they’re ready to slow its descent for fear of fanning capital flight if the Chinese currency drops too quickly through the psychologically important 7-per-greenback level.
On Friday, the Chinese yuan sank to an eight-year minimum of 6.8950 per greenback, extending a steep drop in the past week and taking its sag so far this year to 5.8%. If maintained, it would mark the yuan's greatest annual dive since the landmark revaluation in 2005.
Chinese policymakers are assured that the drop in the Yuan since October clearly reflects market trends, especially of late when the vast majority of currencies have dropped in the face of a resurgent greenback.
However, the Yuan's outlook is clouded by the election of Donald Trump as American president. It’s because during his campaign he promised to label China a currency manipulator on January 20, his first day in office and also to impose tariffs on Chinese imports.