© 2019 Bloomberg Finance LPWith President Trump’s imposition of higher tariffs on Chinese exports, Beijing appears ready to deploy its currency weapon again. The Chinese renminbi fell to 6.9342 to the U.S. dollar on Wednesday, a fall of 8.77% this year alone. With U.S. tariffs at 10% on $200 billion in Chinese imports, the falling currency almost wipes out the effect of the price increase on Chinese exporters. While such a decline helps exporters, it could trigger currency outflows from China as businesses seek to stabilize their assets. Reuters last week reported that three sources close to Chinese foreign exchange decision-makers said Beijing would not allow the currency to breach the 7 to the dollar level.

Source: Forbes May 22, 2019 15:49 UTC