China Considers Yuan Depreciation Against Possible U.S. Tariffs

On Wednesday, it was reported that Chinese leadership is considering a strategy to allow the yuan to depreciate by 2025. This thought comes as a response to the anticipated increase in U.S. trade tariffs during a time when Donald Trump is preparing to re-enter the White House. Negotiations indicate that China is preparing significant economic stimulus to mitigate the effects of the trade policies proposed by Trump.

According to sources familiar with the matter, Trump has stated his intention to implement a 10% universal import tariff on goods imported into the U.S. and a 60% tariff on goods imported from China. Such trade barriers could significantly impact China’s export-driven economy.

In anticipation of these measures, Chinese officials are discussing whether to allow the yuan to depreciate. A weaker yuan could potentially lower the cost of Chinese exports and make them more competitive internationally despite higher tariffs. This would also result in looser monetary conditions within mainland China.

Information regarding these internal discussions has come from three individuals familiar with the topic, who preferred to remain anonymous due to the sensitivity of the matter and their lack of authority to disclose such plans publicly.

Currently, the People's Bank of China (PBOC), the country's central bank, has not commented when approached by media outlets. Similarly, the State Council Information Office, responsible for government media relations, did not immediately respond to inquiries regarding this potential policy change.

This article has been generated with the support of artificial intelligence, translated, and reviewed by an editor. For more information, please refer to our Terms and Conditions section.