(Bloomberg) --
Assurances from China’s central bank that it won’t use the yuan to fight a trade war with the U.S. have fallen on deaf ears.
Traders’ incredulity has a lot to do with how China goes about devaluing the yuan -- lulling the market into a sense of stability and then going for it at the most unexpected moment. When Yi Gang was PBOC’s deputy governor, he and other officials repeatedly gave assurances that the currency would remain stable before devaluing it almost five years ago to the day, spurring global market turmoil.
Timeline Then
April 2015: Premier Li Says China Doesn’t Want Devaluation
May 2015: PBOC’s Yi Says Devaluation Not Necessary
August 2015: Yuan Devaluation Jolts Global Markets
Timeline Now
April 2019: Xi Says China Won’t Pursue Harmful Yuan Devaluation
May 2019: PBOC Pledges Steady Yuan
Aug. 5, 2019: China Lets Yuan Tumble Past 7 Per Dollar as Trade War Escalates
Aug. 5, 2019: PBOC’s Yi says China Won’t Use FX as Tool in Trade Dispute
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