Westpac’s Callow Sees Modest Depreciation for Yuan by Yearend

The video discusses the ongoing trade discussions between the US and China, focusing on the challenges of reaching a binding agreement on currency stability. It highlights the importance of currency flexibility and the potential delays in reaching an agreement. The video also examines the impact of fiscal stimulus on the yuan and provides economic growth projections, emphasizing a modest depreciation of the yuan and a strong dollar story.

What is the main reason for skepticism about the US-China trade agreement?

• Differences in political ideologies

• Concerns over trade tariffs

• Difficulty in reaching a binding agreement on currency stability

• Lack of trust between the countries

Why is it unlikely that there will be a rigid agreement on currency?

• The US does not support currency flexibility

• China is unwilling to sign any agreement

• Currency flexibility is needed for economic stability

• The G20 meetings have already set the terms

What is the expected movement of the yuan in the next three months?

• Appreciation to 6.5

• Stability at 6.8

• Fluctuation between 6.6 and 6.9

• Depreciation to 7.0

How does the fiscal stimulus impact China's economic growth?

• It is expected to decrease growth

• It is expected to maintain growth at the lower end of the target range

• It will have no impact on growth

• It will cause a significant increase in growth

What is the anticipated action of the US Federal Reserve by December?

• No further rate hikes

• A rate cut

• One more rate hike

• Two more rate hikes