Western investors abandon their previous positions on Yuan

A bunch of Western investors previously placed bets for the last two years that China’s Yuan currency would go down due to a weaker Chinese economy. Other potential risks include a debt crisis and capital outflows. However, they’ve recently changed their positions, motivating their move by the fact they might lose in the short term if they try to take on the People’s Bank of China. This country’s key financial institution has been taking several measures aimed at keeping the national currency stable.

It’s the case ahead of an autumn congress of the leading Communist Party of China, expected to enable Xi Jinping, Chinese leader to consolidate his power. Additionally, the Chinese economy has been more sturdy than expected and the nation’s government has taken adequate measures to reduce capital outflows. In addition to this, the greenback has been rebounding from revenues it made last year.

Key global fund managers, including Old Mutual Global Investors, Asset Management, Goldman Sachs and Investments and Aviva have already taken off their short Yuan positions.

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