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The Chinese Yuan is downgraded to 7 per US dollar

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  • The Chinese Yuan is downgraded to 7 per US dollar

    It used to be 6 Yuan for a US dollar but with the ongoing trade war with the US, China decided to lower the value of their currency so that their buyers from the US will still continue to buy despite the new tariff levied by President Donald Trump. It is like buying 7 items for a dollar where before you could only get 6 pieces. That will neutralize the added 20% tariff if you are an importer in the US.

  • #2
    This is true, although won't it also make imported goods more expensive for the Chinese consumer?
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    • #3
      To be honest, I am glad that China has been directly affected by the tariff acts of Donald Trump. Maybe itís about time that China is put in its right place in the market. Being so big is not a reason to bully the traders and control the market values. Now if the Yuan will not perform well in the downgrade then the Chinese economy would surely suffer. China should rethink its firm stand against Trumpís posturing on the trade war.

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      • #4
        I may be wrong (time will tell) but I think China will outlast the USA in any protracted trade war. The western consumer culture is built around immediate availability, whereas the Chinese are still moving from an era when goods were not immediately available (if at all) and haven't fully reached the west's level of expectation. The way I see it, if an American can't get what they want immediately they will start to complain, the Chinese will shrug their shoulders. I believe the USA buys $400 billion more from China than China buys from the USA, so the average US citizen stands to be far more affected by the trade war than their Chinese counterpart. I don't think this will end well for Trump.
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