Yuan Asia's Best Performer After Moody's Downgrade

The video discusses recent changes in the onshore yuan, highlighting a shift in the Chinese authorities' fixing mechanism. This shift aims to align the yuan more closely with a basket of currencies, countering its previous depreciation trend. The video explores the implications of this change, including potential impacts on yuan bears and the broader market. It also considers the political context, such as meetings between President Xi Jinping and President Trump, and upcoming economic events like China's potential inclusion in the MSCI index.

What recent trend has been observed in the onshore yuan over the last six months?

• It has been stable against a basket of currencies.

• It has been appreciating steadily.

• It has been fluctuating without a clear trend.

• It has been falling, breaking a stable trend line.

What change have the Chinese authorities made to the yuan's fixing mechanism?

• They have taken back control to align it with other currencies.

• They have allowed the market to determine the fixing.

• They have pegged it to the US dollar.

• They have removed all controls over the currency.

What message are the Chinese authorities trying to convey with the new fixing methodology?

• The RMB should only appreciate.

• The RMB should remain stable.

• The RMB should only depreciate.

• The RMB should be volatile in both directions.

How might the yuan's appreciation be politically beneficial during the 100-day review period?

• It would have no political impact.

• It would show economic weakness.

• It would align with US interests.

• It would be seen as a positive political gesture.

What upcoming events could be influenced by the strength of the yuan?

• China's inclusion in the MSCI index and the Hongkong Bond connect.

• The World Cup hosting decision.

• The US presidential elections.

• The European Union's trade agreements.