Just a brief one after today's other post was written (but not yet published!)
Today marks the end of an era, as China has devalued the RMB by 1.9% via today's fixing, by far and away the largest official depreciation since the currency started to revalue a decade ago. Indeed, today's devaluation very nearly matches, in percentage terms, the revaluation that accompanied the shift to a CNY appreciation policy in 2005.
Sadly, sans Bloomberg Macro Man cannot show a time series graph of the reference rate; however, a chart of the offshore CNH market gives you a small idea of the impact:
Moreover, henceforth the parity calculation will be done a little differently, as highlighted here. A ploy to make ti more market-driven to get into the SDR? Possibly. A throwing of the towel to acknowledge the relatively dire straits of the economy? Almost certainly, to a degree.
As everything begins to reprice to where it was a dozen years ago, it sure feels like the commodity currency complex has a ways to go still....
Today marks the end of an era, as China has devalued the RMB by 1.9% via today's fixing, by far and away the largest official depreciation since the currency started to revalue a decade ago. Indeed, today's devaluation very nearly matches, in percentage terms, the revaluation that accompanied the shift to a CNY appreciation policy in 2005.
Sadly, sans Bloomberg Macro Man cannot show a time series graph of the reference rate; however, a chart of the offshore CNH market gives you a small idea of the impact:
Moreover, henceforth the parity calculation will be done a little differently, as highlighted here. A ploy to make ti more market-driven to get into the SDR? Possibly. A throwing of the towel to acknowledge the relatively dire straits of the economy? Almost certainly, to a degree.
As everything begins to reprice to where it was a dozen years ago, it sure feels like the commodity currency complex has a ways to go still....