Yuan move may mean China is wary of economic shift

Washington

TO understand China's surprise currency devaluation, you need context.

China is engineering a major economic transformation - or, at least, trying. For years, it relied upon export-led growth and massive investments in housing, infrastructure (roads, rails, ports) and heavy industry (steel, glass, aluminium). This economic model now seems spent. World trade is weak. Over-investment in housing, infrastructure and industry has left gluts. So China is switching its engine of growth to consumer spending on services and light manufacturing.

Whether this conversion succeeds or fails is a mome…