Singapore Dollar, Thai Baht At Risk As Yuan Slumps

Investors in the Singapore dollar and Thai baht will have to brace for losses if the Chinese yuan, the worst-performing Asian currency on Monday, Nov. 7, 2022, continues its fall against the dollar as the country sticks to zero COVID-19 approach, Marcus Wong reported for Bloomberg News.

Photo Insert: Both currencies have the highest 3-month daily correlation with the offshore Chinese yuan in emerging Asia, signaling a further drag from extended weakness in the Chinese currency.

Both currencies have the highest 3-month daily correlation with the offshore Chinese yuan in emerging Asia, signaling a further drag from extended weakness in the Chinese currency.

The People’s Bank of China’s move on Monday to end its string of stronger-than-expected yuan fixings that had been in place since August has traders betting that Beijing is reducing its support for its currency.

Moreover, China’s exports are retreating as global demand freezes and domestic factories producing cars, appliances, consumer items and others are shutting down due to recurrent COVID-19 outbreaks.

A report from the Associated Press (AP) showed that Chinese exports slid 0.3% from a year earlier to $298.4 billion, down from September’s 5.7% growth. Imports fell 0.7% to $213.4 billion, compared with the previous month’s 0.3% expansion.

China’s global trade surplus edged up 0.9% from a year earlier to $85.2 billion.

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