As yuan skids, markets bet more depreciation is in store

News Snapshot:

China’s yuan is sliding and market participants suspect authorities are deliberately but slowly engineering a light depreciation of the currency, both to complement an easy monetary policy and to support exports. Several signals have stirred that speculation. While the yuan has declined roughly 2% this year against the dollar, it has become relatively less competitive as Japan’s yen and currencies of other neighbors South Korea, Thailand and Taiwan drop more sharply. The People’s Bank of China (PBOC) also appears to have loosened its grip on the yuan, allowing it to fall to the weak side of the 7.2-per-dollar level that...