Swiss RMB hub dream unfazed by currency scare

Swiss analysts are taking a positive view of the recent renminbi devaluation. The recent fluctuations of the Chinese currency and stock market volatility have not dampened Switzerland’s dream of becoming a renminbi trading hub. Some politicians in the United States lashed out at Beijing for the People’s Bank of China’s decision to let the currency devalue by 1.9% on August 12 – the largest single day slide in decades. But for Swiss observers, it demonstrated China’s commitment to freeing up the currency to market forces. Whilst only a small step in this direction, it was also viewed as significant moment by Cédric Tille, professor of international economics at the Graduate Institute Geneva. Rather than being an aggressive attempt to bring down the price of Chinese exports, Tille saw the move as a rational mirroring of slowing Chinese economic output and the subsequent stock market sell-off. By allowing its currency to follow the markets, the Chinese authorities were ...