RMB regime change will put regional currencies under pressure - ANZ

SINGAPORE – Today’s decision to devalue the Chinese currency can be seen as a measure to strengthen the case for the RMB’s inclusion in the SDR basket later in the year, according to ANZ Bank, which says there is also an intention to weaken the currency in order to support China’s export sector.

“How far the authorities will tolerate further RMB depreciation remains to be seen. But with RMB no longer providing an anchor for the region’s currencies, we expect other Asian currencies to come under pressure,” ANZ says. www.live.anz.com (ATI).