China devalued and intensified the economic war with this …

With little margin on the commercial front to replicate the new tariffs set by the United States, the Chinese government validated Monday a devaluation that left its currency at the lowest values ​​for eleven years. A 1.3% increase in the exchange rate brought the price down to seven yuan to the dollar and hit unobserved records since 2008. Movements in Asian currency are within the daily parameters provided by the government. . Central Bank of China, but the US President, Donald Trump accused the Chinese of "manipulation of parts".

As usual, the US president asked his questions on Twitter:
"China has lowered the price of its currency to historically low levels. This is called "coin handling". The Chinese response came through a statement in which the chairman of the monetary authority, Yi Gang, said that he would not devalue to improve the competitiveness of his exports.. The shock wave of escalating economic war between the United States and China added pressure on the fragile stability of the local currency market, where the price in dollars exceeded 46 pesos.

China's foreign exchange policy allows the exchange rate to fluctuate up to 2% per day compared to the reference value set by its central bank. On Monday, the fixed exchange rate was 6.9225 yuan. The price climbed 1.3%, ending the Asian trading day above 7 yuan for the first time since May 2008.

Despite Trump's accusations on Twitter, the Central Bank of China said the weakness of its currency was responding to protectionism and rates, but said it had "experience, confidence and the ability to maintain the rate of changes to a reasonable "and balanced" level.

The president of the entity said in a statement that China would not resort to foreign exchange policy to react to "foreign troubles". Unlike Trump, the Chinese avoided referring directly to the United States.. "China behaves like a responsible country and respects the spirit of the G20 Leaders Summit on exchange rate issues, adheres to a market-determined course and will not participate in competitive devaluations and will not be able to compete." will not use the exchange rate. for competitiveness issues ".

A further devaluation of the yuan could boost Chinese exports and limit the impact of rising and expanding tariffs set by the US government. However, the margin of maneuver of the Central Bank of China is limited in that over the last four years, it has sought to ensure the stability of the yuan in order to contain the flight of capital. In 2016, to avoid a rise in the exchange rate bringing the price above 7 yuan, the monetary authorities came to sell $ 106 billion during the month to contain the tensions related to exchange rates. The Chinese central bank holds about $ 3 trillion in reserves (this figure is 45 times higher than that of the central bank of Argentina).

The previous chapter of the international dispute that Trump's stars were in the spotlight last week when the US Federal Reserve has announced a reduction in its benchmark interest rate for the first time in eleven years and the White House has decided to set new tariffs for imports from China. "Do you listen to the Federal Reserve? This is a significant violation that will weaken China over time, "said the US president Monday on his Twitter account.

The dispute has adverse consequences for emerging markets. The dollar is appreciated against major currencies and the stock index has recorded its worst weekly decline in the year. The new episode foresees renewed tensions around the world. In Argentina, the dollar opened the day with a jump of 70 cents and a price of 46.40 pesos. International turbulence and the absence of foreign exchange market management mechanisms facilitate a new capital outflow process and, in the context of the yuan-based reserves of the BCRA, a devaluation of the Chinese currency results in a reduction of local badets.