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RMB update - Lucky number 7
August 4th, 2019
China’s yuan (as proxed by the USDCNH exchange rate) below 7 tonight.
Media having a hard time differentiating between whether it ‘fell’ or was ‘pegged’ lower.
Regardless of if it was market driven or pegging, once USDCNH got past 7, it kept running.
If you are reading this, you probably know what we think is behind this, and where it’s going.
We continue to remain long gold (and recommend those with the means hedge out the dollar on the other side of this trade by selling Chinese RMB against USD).