TAIPEI CITY, Taiwan, October 25, 2018 (Newswire.com) - Although U.S. President Donald Trump has often accused China of working to weaken its currency on purpose, analysts at Radford Taylor Partners say that China has worked to boost the yuan.
Radford Taylor Partners analysts expect the Chinese yuan to decline further over the next half a year. They say China’s currency could exceed the psychologically important seven yuan per dollar mark and could reach 7.1 over the course of the next six months. So far this year, the Chinese yuan has fallen by six percent against the greenback and is currently trading at approximately 6.94.
The U.S. is watching the yuan closely for signs that Trump’s accusations of currency manipulation are justified. If the yuan were to cross the seven barrier before the end of the year, Trump would likely view this as evidence that China is weakening its currency intentionally.
Radford Taylor Partners says China will try to avoid exposing itself to such accusations, especially in the lead up to the G-20 summit due to take place in November.
Trump frequently accuses the world’s second-largest economy of manipulating its currency so that it will gain a more competitive edge in the export market.
Although China has come under fire for allowing its currency to decline, Radford Taylor Partners analysts say the country has in fact taken measures to prop up the yuan as it has neared the level of seven to the greenback, including trying to restrict capital outflows which usually speeds up the decline of its currency.
Source: Radford Taylor Partners