a day ago
( @karatbarsworldbullion )
Article via: The Epoch Times: “Chinese people are starting to feel the pressure of economic slowdown. As China’s yuan continues to devalue, and several small- and medium-sized banks have recently filed for bankruptcy, many Chinese are choosing to buy gold or take their money out of banks to protect their assets.
Additionally, the Chinese government issued an unusual notice in late June to encourage Party members and cadres to invest in stocks, which is interpreted by many as a desperate move to rescue China’s economy.
China’s yuan or renminbi (RMB) fell sharply on July 2, hitting its weakest level against the U.S. dollar in a week. By 4:30 p.m. Beijing time, the onshore RMB closed at 6.8835 against the dollar, a fall of 391 points from the previous trading day. Offshore RMB closed at 6.8856, which was a drop of nearly 300 points. Reuters’s Chinese-language edition quoted a currency trader as saying that investor optimism continues to wane upon seeing the ups and downs in the previous rounds of trade negotiations. They rush to trade Chinese yuan into U.S. #dollars whenever the dollar weakens a little bit. Therefore, presently, the dollar is very stable and the Chinese #currency still faces further downward pressure.
The trade tensions between the United States and China have seriously affected China’s #economy. In particular, after U.S. President Donald #Trump announced to increase the tariffs on $200 billion worth of #Chinese goods from 10 percent to 25 percent on May 5, the #yuan #depreciated by about 2.5 percent.
Deutsche #Bank has predicted that the #tariff increase from 10 percent to 25 percent would lead to a devaluation of the yuan to 7.1 against the dollar. If the United States decides to impose tariffs on the additional $300 billion worth of Chinese goods, the yuan may further depreciate to 7.4 against the dollar.