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Yuan Declines for Third Day on Global Growth Slowdown Concern
Sep 6,2011 10:42CST
industry news
Source:SMM
China's yuan fell for the third day as fresh signs the global economic recovery is losing traction dimmed the outlook for exports and curbed demand for emerging- market assets.

Sept. 5 (Bloomberg) -- China's yuan fell for the third day as fresh signs the global economic recovery is losing traction dimmed the outlook for exports and curbed demand for emerging- market assets.

Jobs growth in the U.S. unexpectedly stalled in August, the country's labor department said on Sept. 2. German Chancellor Angela Merkel's party lost an election in her home state, fanning concern Europe's major economies will back away from bailing out smaller neighbors facing debt crises. Chinese export orders contracted in August for the first time in two years, according to the findings of a survey published Sept. 1 by the China Federation of Logistics and Purchasing.

"U.S. and Europe's poor economic outlook will exert pressure on China's exports as they remain the country's major export markets,” said Shen Jianguang, chief economist for greater China at Mizuho Securities Asia Ltd. in Hong Kong. "With a less certain export outlook, China faces more domestic opposition to allow more currency gains.”

The yuan weakened 0.05 percent to close at 6.3858 per dollar in Shanghai, according to the China Foreign Exchange Trade System. The People's Bank of China set the reference rate 0.05 percent lower at 6.3926. The currency is allowed to trade up to 0.5 percent on either side of the daily fixing.

In Hong Kong's offshore market, the yuan fell 0.1 percent to 6.3595 per dollar. Twelve-month non-deliverable forwards slipped 0.07 percent to 6.2868, a 1.6 percent premium to the onshore spot rate, according to data compiled by Bloomberg.

China's non-manufacturing industries expanded at a slower pace last month, based on the findings of a China Federation of Logistics and Purchasing survey published Sept. 3.

 

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