# China Lets Yuan Tumble Past 7 Per Dollar as Trade War Escalates

1. [5]
Algernon_Asimov
Our Australian stock exchange fell 2% (about AUD 38 billion) due to this - a significant drop. The writer/editor could have chosen a better graph to depict the fall of the yuan than one that goes...

Our Australian stock exchange fell 2% (about AUD 38 billion) due to this - a significant drop.

The writer/editor could have chosen a better graph to depict the fall of the yuan than one that goes up. Choose a different measure so the visual matches the text.

1. [4]
nic
The Yuan weakened up past 7, so now the US dollar can purchase more Yuan: https://www.google.com/search?q=usd%2Fyuan Another way of saying that is that the yuan fell from 15 cents to 14 cents, but...

The Yuan weakened up past 7, so now the US dollar can purchase more Yuan: https://www.google.com/search?q=usd%2Fyuan

Another way of saying that is that the yuan fell from 15 cents to 14 cents, but that just looks silly IMHO: https://www.google.com/search?q=yuan%2Fusd

1 vote
1. [3]
Algernon_Asimov
I do understand the graph, but thanks for the explanation. I was just saying that they could have chosen a different graph to represent their point. If they're talking about the yuan going down,...

I do understand the graph, but thanks for the explanation.

I was just saying that they could have chosen a different graph to represent their point. If they're talking about the yuan going down, they could have used a graph which had a downward trend. Match the visuals to the text, to reinforce the message of a falling yuan.

When I see graphs showing the value of the AUD against the USD, they don't say "The US dollar buys 1.42 Australian dollars, up from yesterday's value of 1.41 Australian dollars." They say "The Australian dollar buys 0.70 US dollars, down from yesterday's value of 0.71 US dollars."

Why not do the same for the yuan? "The yuan buys 0.14 US dollars, down from 0.15 yesterday."

1. [2]
nic
I'm just guessing here, but a move from .14 to .15 is a 7% change. You have to start going to a third decimal place to track more granular changes. Plus the Chinese peg their currency in terms of...

I'm just guessing here, but a move from .14 to .15 is a 7% change.

You have to start going to a third decimal place to track more granular changes.

Plus the Chinese peg their currency in terms of how many Yuan buys a dollar, and 7 used to be the magic number.

Lastly, this is also how they report on bonds. They will say the yield decreased, but then show a graph with an increase in the bond price. So maybe they just like confusing us laymen.

1. RapidEyeMovement
It also has to do with your target audience and what they are used to looking at, since this is a financial story the vast majority are used to looking at the USD to Yuan graph not the inverse of...

It also has to do with your target audience and what they are used to looking at, since this is a financial story the vast majority are used to looking at the USD to Yuan graph not the inverse of that graph.

2. [2]
CALICO
Here we go: Dow plummets 520 points as China trade war escalates

The Dow Jones Industrial Average plunged 524 points, while the S&P 500 dropped 2%. The Nasdaq Composite lagged, dropping 2.6%. The Nasdaq was on track to fall for a sixth straight session, which would be its longest losing streak since late 2016. The S&P 500 headed for a six-day losing streak as well.

The major indexes have also fallen more than 5% from their record highs set last month.

1. alyaza
donald has also logged on: Based on the historic currency manipulation by China, it is now even more obvious to everyone that Americans are not paying for the Tariffs – they are being paid for...
3. [5]
VoidOutput
(edited )
Further reading: Financial Times: Mounting trade jitters ignite bond rally and pressure stocks Yahoo! Finance: Asia markets sink as the Chinese yuan tumbles The Wall Street Journal: Stocks Drop as...
1. [4]
VoidOutput
End of day update as stocks suffered 3 percent losses on average in the US. Financial Times: US stocks suffer worst day of 2019 as trade fears roil markets New York Times: China Uses Currency as...

End of day update as stocks suffered 3 percent losses on average in the US.

1. [3]
VoidOutput
And now the US has declared China to be a currency manipulator while the Bank of China previously denied it would use its currency as a tool in this trade war. This declaration seems to be mostly...

And now the US has declared China to be a currency manipulator while the Bank of China previously denied it would use its currency as a tool in this trade war. This declaration seems to be mostly theatrics as China fails to meet the IMF definition of a currency manipulator.

Stocks are nonetheless being impacted by this latest escalation, starting with Asia and Oceania. New Zealand is for instance still seeing a 2 percent decline despite very encouraging national employment figures. We are seeing similar or worse declines across Japan, Korea with Australia having less severe numbers at the time of writing. We'll see what the impact is on Chinese and European stocks later.

Interesting times indeed.

1. alyaza
seems exceedingly likely that the plunge will continue tomorrow unabated when US stocks open again.

seems exceedingly likely that the plunge will continue tomorrow unabated when US stocks open again.

4. [3]
nic
The yield curve is getting worse, but not fully inverted This raises the chances of a recession significantly CNN warned about Trumps trade war two days ago

The yield curve is getting worse, but not fully inverted

This raises the chances of a recession significantly

A spokesperson from China's Ministry of Commerce said in a statement that although China does not want a fight, the country "will fight if necessary." The official said that China will have to "take necessary countermeasures," but did not explain what that retaliation will be.

Beijing's options include firing back with tariffs of its own, restricting the supply of the rare-earth minerals that the global tech industry relies on, and devaluing the country's currency.

1. [2]
rkcr
I'm confused - I thought it's been inverted for >3 months already (source)?

The yield curve is getting worse, but not fully inverted

I'm confused - I thought it's been inverted for >3 months already (source)?