Tuesday, September 25, 2012

Wall Street Journal: China Yuan up as Firms, Banks Cut Dollar Positions

The US Dollar keeps weakening and the China Yuan gets stronger.  Not a good sign for your future.

China Yuan up as Firms, Banks Cut Dollar Positions - WSJ.com

China's yuan was higher against the U.S. dollar late Tuesday as companies and banks continued to cut dollar positions ahead of the weeklong national day holiday next week, despite the central bank's guiding the Chinese currency lower via a daily reference rate. On the over-the-counter market, the dollar was at 6.3066 yuan around 0830 GMT, down from Monday's close of CNY6.3093. It traded in a CNY6.3019-CNY6.3113 range. "Companies and banks accumulated too many dollars when the yuan was depreciating earlier this year, so we are seeing heavy dollar selling flows as they cut their positions," said a Shanghai-based trader with a local bank. The yuan declined by as much as 1.6% against the dollar between the start of the year and late July. It has since recovered and is now down about 0.2% since the start of the year.

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Breaking US Dollar Collapse News

What's Behind the Decline of the US Dollar?

This is one the of the best and simplest explanations we have seen:
The U.S. dollar's downward slide is accelerating as low interest rates, inflation concerns and the massive federal budget deficit undermine the currency. - Wall Street Journal, April 23, 2011
Interestingly, the Federal Reserve is responsible for, or an active participant in all three of these factors.

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