China "Weaponizes Yuan" - Weakens Fix By Most Since 2016

[TaiShang]

China "Weaponizes Yuan" - Weakens Fix By Most Since 2016

by Tyler Durden
Thu, 07/19/2018

The PBOC just lowered the ax on the Yuan Fix - slashing their reference rate by the most since June 2016.

Offshore Yuan is tumbling to new cycle lows after the fix...CNH is down over 1250 pips this week - the biggest weekly devaluation since August 2015's plunge.

President Trump is gonna be pissed!!

Will China's chaotic capital markets ripple across the world?

Yen just snapped stronger...

The Indonesian Rupiah tumbled 0.5%, and gold is falling...

As we concluded previously, so how long before the trade war, which is already shifting to a currency war as a result of the recent record devaluation in the yuan, morphs into a central bank war and a renewed race to the bottom between the world's two most important economies? .. or worst still as Bannon suggested, a kinetic war.

Russia is an annoyance. China is our great challenge. Russia's economy is the size of Texas or New York State? It's got lots of nuclear weapons...but in today's warfare...nuclear weapons are taking a less important role. Trump is trying to end the Cold War and the Korean War...and all he is getting is grief from the globalists.

And that's a huge problem, because not only are we adversaries with China, we are at war with China, Bannon said.

We're in a war with China. Ray Dalio tweeted the other day. There's three types of war:information war, economic war, and guns-up kinetic war. They've been at war with us for 25 years. Many people in this room have exacerbated the rise of China."

Pushing back against the notion that Trump lacks grand foreign policy vision, Trump, like Reagan, is trying to build a foreign policy behind American assertiveness and optimism. Furthermore, the notion that China has advantages over the US in a trade war is laughable; the US can - and will - win, Bannon said.

If they devalue their currency they're just going to flood more dollars out. That's what their own people think about their economy. We allowed them to take the South China Sea. Donald Trump is not going to back off this. Donald Trump is not going to blink. Victory is when they give us access to their markets.

This trade war is going to end in victory and what you're going to see is a reorientation of the entire supply chain out of China.

But, we remind readers that 'hope' is not a strategy.

https://www.zerohedge.com/news/2018-07-19/china-weaponizes-yuan-weakens-fix-most-2016

 

[Kiss_of_the_Dragon]

Victory is when they give us access to their markets.

With Trump's protectionism want to access to China's market?, what a wet dream, most likely China will tightening and controlling on how American corporates are operating in China and restricting US future investment. US shall not have victory without making China as a winner too, I don't know how much China's trade weapon but likely China will hold to last stand or else China will forever a loser like Japan in plaza Accord.

But in my opinion, China has already score over US to show the world that there is someone in this planet is standing up to US's tariff war and lead the way to encourage EU and Other nations to oppose US's unilateralism. In the future if any nation facing US's economical pressure or sanction, they will know who to look for...crisis is also opportunity, China certainly get interesting payoff out of this trade war.

 

[8888888888888]

Looks ridiculou with the trade war, I can see other countries having access but not USA with the trade war.

 

[TaiShang]

Looks ridiculou with the trade war, I can see other countries having access but not USA with the trade war.

They think they can find access by way of threats and bullying. Mostly, it backfires. Even SP12 resists with its deficit-based economy.