China Macroeconomics & Academia

Christopher Balding

FX & Rates

<p>Recent news of the PBOC ending the NDF reserve requirements seemed to have an immediate impact on the USDCNY. The RMB fell in value and causing widespread speculation of a continued and increasing devaluation of the yuan. Though we believe this was more linked to the perfectly timed USD reversal, this may have broader implications on the USD as well.</p><p>The USD and RMB are closely tied but generally negatively correlated, as seen from Figure 1. However, the CNY Index is more artistic in nature given…</p>

Recent news of the PBOC ending the NDF reserve requirements seemed to have an immediate impact on the USDCNY. The RMB fell in value and causing widespread speculation of a continued and increasing devaluation of the yuan. Though we believe this was more linked to the perfectly timed USD reversal, this may have broader implications on the USD as well.The USD and RMB are closely tied but generally negatively correlated, as seen from Figure 1. However, the CNY Index is more artistic in nature given…

Fed Rate Hikes, the RMB, and Capital Controls