Tweaking the renminbi glide path

China’s foreign exchange policy is evolving. The current offshore renminbi short squeeze and the exchange control measures introduced recently seek to make the renminbi a two-way bet, aiming to slow capital outflows. The pace of decline of the renminbi this year (both onshore CNY & offshore CNH) will also be slowed and, for as long as the Trump reflation rally continues, happen principally against the US dollar.

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