China’s Adjustment for the 10% Tariff May Have Taken Place, Says MUFG’s Tan

The transcript discusses the impact of US tariffs on Chinese exports and the resulting adjustments in the yuan's value. It explores the People's Bank of China's (PBOC) strategy in managing the currency, emphasizing a defensive rather than offensive approach. The potential for using currency as a trade weapon is considered, with a focus on the trade-weighted exchange rate. Market reactions to recent yuan adjustments are analyzed, and predictions for future movements are made. The discussion concludes with insights into the flexibility of China's exchange rate and its implications for interest rates.

What factors might influence the yuan's value towards the end of 2019?

How do Chinese authorities typically respond to currency adjustments?

What is the significance of the PBOC's actions regarding currency weakness?

In what ways can a currency be weaponized for trade purposes?

What implications does a flexible exchange rate have for China's monetary policy?