Ruble Falls as a Result of Yuan Devaluation

China’s recent 1.8% devaluation of the yuang triggered a 2.3% drop in the Russian ruble and lowered the global price of oil to below $50 a barrel. The devaluation has worsened the value of the slumping ruble, the results of which have been described in mixed terms by China-Russia analysts. While some allege that the immediate impact could lead to tensions between Moscow and its largest trading partner in Beijing, others have been quick to point out that an uptick in the Chinese economy would almost certainly equal growth in the Russian economy and a potential increase in the ruble’s value.

The Chinese are not expected to stop at a 1.8% devaluation and could devalue the currency beyond 5% if the initial influx of capital proves unsuccessful. The move, described by one analyst as “China’s version of quantitative easing,” is intended to revive China’s export industry, which has decreased by 8.3% since last year. The Kremlin has yet to issue a statement regarding the devaluation but has assured analysts that the slide in the ruble’s value will not prove damaging due to its own “control over the currency market.”

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News Briefs: 

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