Yellen Dropping China Manipulator Label Won’t Help Weak Yuan
- Secretary will decline to name China as FX manipulator: report
- Dollar, foreign flows, other aspects of tensions to drive yuan
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China’s yuan is unlikely to escape its current bout of weakness, even with help from U.S. Treasury Secretary Janet Yellen.
While Yellen’s decision not to name China as a currency manipulator removes a flash point, analysts say that tension between the two countries have moved to strategic issues such as technology leadership. The yuan is also weighed down by other factors including slowing capital flows and a narrowing yield spread with the dollar.