Via Bloomie:
Nick Twidale, chief operating officer at Rakuten Securities Australia Pty., a unit of the major Japanese trading house, reckons the Aussie will trade below 70 U.S. cents by year’s end, and potentially as low as 60 cents in the longer-term.
“The Aussie has been regarded as the major currency risk proxy for the APAC region and specifically China for a while now, and for good reason,” said Twidale.
Amazing chart. Makes sense. Great Southern Canton doesn’t need it’s own currency.
As the yuan falls the trade war obviously heats up. As well, it also undermines wider emerging markets competitiveness, and that erodes the commodities bid so there is a fundamental driver as well.
When will the CNY turn? Not until China gets stimulus traction and the Fed eases off.
Not there yet.