Bitcoin Forum

China's yuan currency falls for a second day

China's Central Bank has again cut the guiding rate for the national currency, the yuan, a day after Tuesday's record 1.9% devaluation.

The move sent fresh shockwaves through Asian markets, but the bank has sought to calm fears, saying it was not the start of a sustained depreciation.

The yuan fell another 1% on Wednesday, marking the biggest two-day lowering of its rate against the dollar in more than two decades.

The new rate is meant to boost exports.

Figures released at the weekend showed Chinese exports fell more than 8% in July, adding to concerns the world's second largest economy is heading for a slowdown.

There were further signs of weakness on Wednesday, when figures showed industrial production in July rose 6% from the previous year. The rise was smaller than expected and was also below the 6.8% increase seen in June.

Fixed asset investment, a measure of state spending on infrastructure, expanded 11.2% for the first half of the year, also below estimates and at its lowest since December 2000.

http://www.bbc.co.uk/news/business-33875061

The last part of the article starting with "The International Monetary Fund said the move to make the rate more market-based "appears a welcome step"." is more important.

China is using mild short term economic stress as a reason to implement steps that will position it better in the long run.

The real tragedy is that for decades the United States has set a standard for superpowers to exploit the other countries. Now all China can do is follow this standard.

The fact that China sees urbanization as the solution to various problems is solid evidence they are going to continue the U.S. policy of utterly fucking the planet for short term gain, at their own long term expense.

If the Yuan devalues and Bitcoin falls in tandem, does it suggest traders in China see Bitcoin as a commodity rather than currency?

I guess They rather Sell BitCoin too raise funds too feed themselves, I expected Many Chinese Flooding into bitcoin but it seems its just not the case.

I was expecting a major CNY devaluation for quite some time. The USD is too strong right now. Most of the other currencies (such as the UKP, EUR, CHF, AUD, HKD, and CAD) have lost 25% to 50% of their value against the USD. Even crude oil, gold and silver are going down against the USD. The Chinese were forced to devalue the CNY, to make the Chinese exports to Europe competitive.

I doubt if people who are that desperate have their funds in Bitcoin.
The rich might find Bitcoin useful to avoid China's capital controls.

Just check this chart from Bloomberg:

http://assets.bwbx.io/images/iU4iAAoDhsmk/v2/-1x-1.png

It is clear that the exchange rates were rising too fast for the CNY. And this chart is showing the USD vs CNY exchange rate. If you check the EUR vs CNY exchange rate, then you will be surprised to find that the rise is almost 100% in a period of 5 years.

Not just China's economy, lots of economies weakening at same time . There are a dozen nations around the world undergoing economic trouble. Each of them has a contagion effect on neighboring and interdependent economies.

We have been going down this road since maybe late 2008 but keep putting off the issue as a global movement.  Think this has become so big a issue that its going to hit and have dire consequences for all of us.  You imagine a generation that is all about computers and suddenly they have to reset when the power goes out! Maybe a stretch but we are in trouble and its not all China.

But watching how China deals with this is always interesting to me,same as Russia. The two Countries for me go about things a lot differently and from a layman's view of economics,noteworthy.