The chinese yuan Devaluation

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Information about The chinese yuan Devaluation

Published on December 11, 2016

Author: ShubhamMongia

Source: slideshare.net

1. SUBMITTED BY SHUBHAM MONGIA

2.  INTRODUCTION  PAST SCENERIO  IMPACT OF CURRENCY MANIPULATION  IMPACTS  DEVALUATION  GLOBAL IMPACTS

3.  China pegged Yuan in 1997  Growth in real GDP  Pressure to revalue the currency  In 2005,officially the value of yuan changed

4.  More exports than imports  In 2002-2004,EU’s trade deficit with china had doubled  Yuan was undervalued by 15%-20%  Political pressures at Home

5.  Increase U.S trade deficit  Negatively affects U.S business -Chinese imports relatively cheaper -U.S exports to china relatively more expensive  Downward pressure on U.S interest rates  Capital inflows  Compositional shift in U.S economy

6.  Reduced risk for investors  Increased competitiveness for FDI  Higher cost foreign consumer imports  Higher cost of imported factor inputs (raw materials, machinery, parts)  Lower local wages higher employment  Expanded yuan supply, easy credit, non performing loans.

7.  De-linked the yuan  Widening the trading bank of yuan  What next..!!!

8.  Devalued its currency in 2005  Increased its exports  Growth in GDP  Devalued its currency again in 2015

9.  Slump in the share market  Industry giants to invest in china  Other countries GDP imbalanced

10. T H A N K Y O U

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