China's persistent economic weakness and the escalation of the tech war between Washington and Beijing continue to drive the country's currency, the RMB (Yuan), lower, according to Dr. Tenpao Lee, professor emeritus of economics at Niagara University.
"Fundamentally, the value of a country's currency reflects the strength of its overall economy in general," Professor Lee explained. "For example, China's economy in the post-pandemic era was in deep trouble with higher unemployment rates, collapsed real estate sectors, and dramatic capital outflows. As a result, China's currency, the Yuan, has significantly depreciated in the last two years, and all assets denominated in Yuan have become cheaper. To make matters worse, the ongoing chip wars and geopolitical factors will add more constraints and limit China's role in the global economy."
