The Yuan has come unpegged, what do you think this will do to inflation and the purchasing power of Americans that buy all the crap we design?
The purchasing power will drop. (Crap will cost more in US= less crap sold)
US and EU products will be cheaper for China to buy.
In banking, some firms may have trouble to pay loans in Yuan if they get their income in USD or EU because the exchange rate will work against them. Marginal firms will default. Bank investors could loose investment.
The market forces will affect firms everywhere as they adjust to variable currencies, and they will be more accountable.
Is Yuan unpegged? I cannot verify this.
it is not unpegged. it is now pegged against a variety of other foreign currencies.
What are these foreign currencies?
Don’t believe the hype, they are instead pegging it to a basket of foriegn currencies (Euro, and whatever else they want) - the difference is minute and is very shrewd on their part - it’s a symbolic gesture but only changes the valuation a small percent - they will continue playing dirty until the US slaps tariffs on chinese imports in the range of 30 to 40 percent (the pricing advantage chinese exporter enjoy with their undervalued currency) - this gesture will take some of the wind out of the sales of the people in congress pushing for tariffs - the only reason the chinese made this “concession”.