Beijing Mulls Yuan Depreciation To Counter U.S. Tariffs

Benzinga 2024-12-11

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China's policymakers are considering allowing the yuan to weaken in 2025 in response to potential higher U.S. trade tariffs under Donald Trump's administration. Trump has announced plans for a 10% universal import tariff and a 60% tariff on Chinese goods. The yuan's depreciation could mitigate tariff impacts by making exports cheaper and enabling looser monetary policies. Analysts warn that aggressive currency devaluation could trigger global trade retaliation. Sources suggest the currency could drop to 7.5 per dollar, reflecting a 3.5% decline from current levels.

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