China – RMB: the end of the peg

The shift in the Chinese exchange rate policy reinforces our strategic positions of being short renminbi (see our report China — pressures of a strengthening dollar, 27 January 2015) and the currencies, corporate debt and equity of a wide range of other Asian EM’s (see our reports Asset allocation: what, where and why, 14 July 2015 and Abe’s style drift, 5 August 2015). The upshot is also negative for commodities and currencies such as the Australian and New Zealand dollars.

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