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Published 5 years ago by civilian with 1 Comments

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  • fractal (edited 5 years ago)
    +10

    This is a very shallow article for a very complicated matter. It is true that a lot of countries want to stop depending on the USD for operations outside that currency, for instance, any trade between China and Brazil should use a Yuan-Real cross, or a between Russia and China should use Yuan-Rubble. China has been trying for some time to have the yuan inside the IMF basket for Special Drawing Rights, and one of the conditions was that they allowed their currency to float more freely in international markets. After the devaluation, the only thing that's real is the close of the gap between domestic Yuan (CNY) and the overseas Yuan (CNH), their "devaluation" is laughable at best, with a volatility of less than 5% since the decision by the PBOC. Meanwhile, the Yen, since the inception of Abenomics, has depreciated more than 40%, boosting Japanese exports. It's not so much controlling the dollar but to create an alternative way for emerging economies to trade between themselves without having to use the USD, something any sovereign country should be doing.

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