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China steps up efforts to shore up sliding yuan

China steps up efforts to shore up sliding yuan

The Chinese yuan is once again facing challenges, with the threat of devaluation looming. However, the authorities in China are not idle. They are actively monitoring the situation and taking steps to mitigate these risks. According to Bloomberg, citing Wang Tao, chief economist and head of economic research for Asia at UBS, Chinese officials are planning measures to slow down the yuan's depreciation in the near future.

Beijing has already implemented a series of stimulus measures, which have borne some fruit so far.

Currently, the yuan is under pressure due to potential tariffs from the United States and a stronger dollar. Wang Tao believes that the Chinese authorities will try hard to moderate the yuan's weakening and make sure it is modest, but any drop is unlikely to drastically change the situation. Instead, it may only slightly boost Chinese exports.

If the yuan continues to lose value, China's competitors may also consider partially depreciating their own currencies. According to Wang Tao, this would offset China's attempts to make its exports cheaper.

Bloomberg reports that the Chinese government is ramping up efforts to shore up the yuan, which has come under strong pressure and hit record lows against the dollar.

Earlier, Goldman Sachs Chief Economist Jan Hatzius said that Chinese authorities would introduce a broad range of monetary and fiscal stimulus measures to counter the impact of anticipated tariffs and a prolonged downturn in the housing market. According to Hatzius' forecast, China's economic growth will slow to 4.5% in 2025.

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