Dollar Breakout Sends Chinese Yuan To Lowest On Record In Offshore Trading

Tyler Durden's picture

Following the stronger than expected Manufacturing PMI print, the USD which has traded rangebound for much of the session, broke out to the upside once more, with the BBDXY trading above 1,207, and in the process pushing the USDJPY solidly above 104, a level which many fx strategists have suggests would lead to further upside momentum.

But the one pair everyone's eyes are on this moment is the USDCNH, or the offshore Yuan, which moments ago just broke its all time low against the dollar, pushing the USDCNH to 6.7875, rising above the previous all-time high at 6.7850, reached on Sept. 2010

According to numerous FX strategist, the 6.80 level is seen as next resistance for pair with a breach potentially opening up path toward 6.83, a level last seen during 2008-10 financial crisis

So far the tumbling Yuan has not had the same repercussions as observed at the start of the Year when fears of Chinese devaluation and capital outflows sent global assets tumbling. Although a few more days of accelerated selling and concerns about China's capital flows may once again return.

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Ghost of PartysOver's picture

If Trump were Pres, that would not happen.  Those damn currency manipulators.

Haus-Targaryen's picture

I'm looking forward to 8:1. 

Peter Schiff would be eating a lot of crow when it happens and Harvy Dent will be grinning from ear to ear as will Andy Hoffman but the Chinese are just as screwed as everyone else is.  

Consuelo's picture



'Make a sound in the East, strike in the West...'


Of course the Chinese are screwed like everyone else.   Hold that thought...

JRobby's picture


Petro Dollar Supremancy or BOOM!

NoDebt's picture

Sneaked the Yuan into the SDR just in the nick of time, I guess.  Somewhere in China somebody's chuckling to himself and thinking "suckers!"


mkkby's picture

Bullshit article.  Nowhere fucking near a record.  Even the article itself references a lower level a few years earlier.  It was around 8:1 in the early 2000s.

Really, this is a TINY TINY devaluation -- under 1%, with vol far less than any other currency.

No story here.

The Ram's picture

I was wondering when this was going to happen.  To keep the mercantilist 'game' going here in America, the Chinese must make their products as cheap as possible.  The Chinese know they must scale US consumption based on $10-$15 dollar/hour labor.  China will continue to devalue its currency. Apparently, the Chinese want to continue the US-China mercantilist game rather than increase their demestic consumption to compensate for declining US slaes/consumption.  BIG mistake, but this is really political in the end.  China does not want a true middle class like the US middle class of the 50's, 60's and 70's.  The party must judge this to be to much of a threat to their power.

NoDebt's picture

"China does not want a true middle class like the US middle class of the 50's, 60's and 70's."

Nobody wants that any more.  Least of all the US.  What a disaster it was.  Millions of people making their own decisions with the financial capacity to follow through on their choices?  No way.  They're never going to let that happen again.  They almost lost control.

Fortunately they reeled it back in and we're heading back the other direction where the elites control everything directly.  As they always wanted it and feel is their divine right to have it.


Dr. Engali's picture

Yes, but at least we can vote so we can master our own destiny. Now get out there and do your civic duty citizen! Merika! Fuck yeah!

new game's picture

VOTE? fut the wuck? voting has become a fools errand. i vote with my feet and they aint goin to no fucking ces poll. only thing u all will get is deomcrap or republoshit on your shoes...

blahzay's picture

Great sarcasm.  Made me laugh.

vasallo7g's picture

i think everything they do at the end has the same goal: that the paper that they print (the dollar) has value, the peso and the yuan have to be devaluated so things can be sold to the USA the problem is the jobs are gone in the USA so this whole scam is getting hard to maintain


World Cash Day's picture

Record high? 10 years ago in 2006 it was over 8 Yuan to a Dollar.

I'd suggest record highs are at least north of that level.

No need to "panic" at least until the Yuan shoots up 7 to the Dollar. That might be just when things start getting interesting.

Elco the Constitutionalist's picture
Elco the Constitutionalist (not verified) Oct 24, 2016 10:16 AM

China is buying all of the things with USD. The price of Yuan is irrelevant.

Snípéir_Ag_Obair's picture

Well, China may be fucked, or they may not be, but if the US stops importing Chinese goods... The US is fuckeder.

mkkby's picture

Do any of you folks over 30 remember HOW china got the jobs?  I do.

Big western companies were all drooling over themselves for 1 billion NEW CUSTOMERS.  But china said, you can't exploit us.  You can sell to our consumers, BUT YOU MUST make the products here and employ our people.  And you cannot just exploit our workers, you must transfer your technology to us, and hire/train chinese managers and engineers.

But that created a problem.  What if the US played the same game.  They could not lose the lucrative US market for 1 billion poor people.  So they got their paid politicians to negotiate trade agreements that opened the US market to products made anywhere.  The chinese won't follow that, but who cares.

So as Ross Perot predicted in the 1991 election, jobs were hoovered outta here.  Totally planned.

Trump can get the jobs back just by playing the same game.  Tear up the free trade agreements, and require product sold in america be made in america.  Just what they did to us.

hobopants's picture

I wonder what this shit will look like after a Trump victory? Synchronized diving with the peso, or moon shot...