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Is China joining the currency war?

Devaluation is not in its interest; the yuan's fall has resulted from market forces and Beijing targeting the trade-weighted exchange rate.

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Devaluation could backfire on China, the world's second largest economy that runs one of the world's largest trade surpluses, and it reduces real household disposable income and hence consumption.

AMONG its Asian peers, the renminbi has dropped the most against the US dollar recently and aggravated Asia's economic challenges in the face of a strong US dollar. Is China finally joining the currency war, as many critics have long argued for?

  • A sharp devaluation of the renminbi
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