The Chinese renminbi fell yesterday to its lowest level since 2008 as the country’s central bank held back from stepping in to support the currency in response to the strengthening dollar.
The renminbi is the last major currency to succumb to a wave of dollar strength that has sent pound to yen exchange rates plummeting this year.
As the People’s Bank of China pursues monetary easing to support economic growth, the ongoing policy divergence with the aggressive US Federal Reserve is expected to push the Chinese currency further downwards.
The PBoC has so far stopped betting significant foreign exchange reserves, relying instead on indirect measures to discourage betting on continued declines and slow the pace of depreciation.
The onshore exchange rate for the currency fell 0.7 percent to Rmb 7.2268 on Wednesday, bringing it down 13.8 percent for the year so far.
Thanks for reading FirstFT Asia. Here’s the rest of today’s news — Emily
Five more stories in the news
1. Bank of England launches £65bn move to calm markets The Bank of England yesterday took emergency measures to prevent a collapse of the UK pension sector, unleashing a £65bn bond-buying program to stem a crisis in government bond markets.
2. India Bans Leading Muslim Group Over Terrorism Allegations Indian Prime Minister Narendra Modi has outlawed the Popular Front of India and its affiliates for five years, accusing it of links to terrorist organizations. The action, which followed the arrests in recent days of more than 200 of its members and searches of the homes and offices of top leaders, is likely to fuel growing tensions between the country’s communities.
3. EU pledges response to ‘deliberate’ sabotage of pipelines Norway deploys its military to oil and gas installations and the EU pledged “a robust and united response” to “deliberate” leaks in two gas pipelines between Russia and Europe. NATO and a growing number of European governments said they believed the leaks were a case of sabotage, while Moscow denies any involvement.
4. Iranian morality police disappear from the streets Escort patrol cars, used by Iran’s vice squad to check and arrest women who defy Islamic dress codes, have disappeared from the streets of Tehran in recent days. The change comes after massive street protests following the death of Mahsa Amini while he was detained by vice squad.
5. UK in ‘difficult’ talks over access to Indian financial sector London Mayor Vincent Keaveny acknowledged in an interview with the Financial Times that India could turn down British calls to ease severe restrictions on foreign financial services companies.
the next day
US-Philippines Bilateral Talks US Defense Secretary Lloyd Austin and Philippine counterpart Jose Faustino Jr will participate in bilateral military coordination talks today, the first time such senior government figures have participated in the annual discussions. The two armies also plan to double the size of their annual joint exercise next year.
Parliamentary elections Kuwait The sixth vote in 10 years, which will be held today, is a product of the political crises that have rocked the country over the past decade. (from Barron)
Porsche starts trading After the long-awaited IPO of the luxury car brand, the shares of the car manufacturer will be traded on the Frankfurt stock exchange.
What else do we read
The rising value of my used Toyota There is a silver lining to the fact that the global semiconductor shortage remains unresolved and wider disruption in the parts and materials supply chain continues. As a result, Leo Lewis found that his Toyota dealer would offer 10 times the expected value to trade in his car – as AI is shaping a thriving used market.
Why dollar strength matters In difficult times, the dollar is the refuge of the world. Messing up macroeconomic policies, especially fiscal management, proves particularly dangerous when the dollar is strong, interest rates are rising and investors seek safety. Kwasi Kwarteng, pay attention, writes Martin Wolf.
The 90 km journey that changed the war in Ukraine A lightning strike by Ukrainian forces this month allowed Kiev to recapture as much territory in a few days as Moscow had conquered in months. Our interactive story shows how the counteroffensive the tide has turned drastically of the invasion.
Biden’s Renewable Energy Efforts to Bring Big Benefits to South Korea There was consternation in Seoul when President Joe Biden abolished subsidies for electric vehicles assembled outside of North America. But what amounts to a short-term setback pales in comparison to the gains Korea Inc will gain overall, writes Christian Davies.
Asteroid deflection is just one thing on our worry list NASA’s mission to knock down a small asteroid 11 minutes from Earth was literally a standout feat that gives hope that we can defend our planet. But human nature and technology come with their own risks, writes Anjana Ahuja.
Dame Prue Leith’s Gloucestershire home is a real showstopper. Leith and her husband John Playfair would never go for black and white when they built their dream home in Gloucestershire. For this story, we entered the Bake Off star’s technicolor home.
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