FX.co ★ Soros versus Chinese yuan

American billionaire George Soros is probably used to being blamed for financial plight. This time, China accused the high-profile investor of “declaring war” on the yuan.

It seems ridiculous that one person, though very rich indeed, could go to “war on the renminbi” and cause a slump in the Asian currency market, all single-handedly. Capital outflows have been putting pressure on the normally stable yuan over the latest weeks and months in overseas markets. Still, the Chinese Communist Party blames the country’s recent economic woes on Soros. The People’s Daily, the official newspaper of the Chinese Communist Party, responded to Soros’ words with an article headlined ”Declaring war on China’s currency? Ha ha”. According to this article, the billionaire’s “war” on Asian currencies could aggravate financial cooperation both in East Asia and on the Belt and Road initiative.

The whole affair started at the annual World Economic Forum in Davos last week, when Soros told Bloomberg TV that a hard landing for the Chinese economy was “practically unavoidable”. Though Soros simply acknowledged the fact that the country was in the doldrums, China is keen to shoot the messenger.