China-G20 - US warns against devaluation ahead of G20 finance meeting

US Treasury Secretary Jacob Lew on Thursday said top economies should refrain from competitive currency devaluations -- a message likely directed at China, which hosts a G20 finance ministers meeting this weekend.

"The global outlook... underscores our focus on the commitment made at the last G20 in Shanghai to consult closely with one another on exchange rate policy, and to refrain from competitive devaluation," Lew said during a visit to Athens.

Finance ministers and central bank chiefs from the so-called Group of 20, which brings together the biggest industrialised and emerging economies, are scheduled to meet in China on Saturday and Sunday.

"We have seen progress in this regard since the last G20 meeting, and we will continue to encourage the use of the full range of policy tools to promote shared, sustainable growth," he said.

Beijing rattled global investors with a surprise devaluation last August, when it guided the normally stable yuan down nearly five percent over a week, in a move largely perceived by analysts as an attempt to boost exports as economic growth slowed.

The talks this weekend will also likely be dominated by Britain's shock decision to leave the European Union in a referendum last month.

On Greece, which is hoping to exit recession this year after a seventh year of austerity cuts, Lew noted that investors were unlikely to return without "long-term clarity" on the prospects for the recovery of the Greek economy.

A failure to confront the subject of debt relief for Greece has clouded the perspectives for its economic recovery.

"The challenge is to get the trajectory onto a path where...it's clear that Greece can sustain its debt. To the investor world, the notion that it's okay now but it may not be okay in the future is not a good signal," the US secretary said.

Among the organisations managing Greece's recovery, the International Monetary Fund has said it won't give a penny to Greece's latest bailout -- the third since 2010 -- until it sees a concrete plan from the Europeans to substantially cut the country's massive debt burden.

Read more: Flash - US warns against devaluation ahead of G20 finance meeting - France 24

Currency wars? China’s yuan drops for a third day

Another day and another chance for China’s central bank to lower the guiding rate for the yuan. It is the third consecutive time the bank has taken such action with its currency.

Thursday’s rate of 1 percent down against the dollar was a smaller margin than the shock cuts earlier this week and the bank announced there was no reason for it to fall further.

The weaker Yuan makes Chinese products cheaper abroad and the currency’s devaluation came in the light of figures showing exports had plunged over eight percent in July.

But has Beijing’s intervention created something of a Chinese puzzle allowing market forces to set the exchange rate but “guiding” the rate to a level to boost exports.

Officials response was to say the bank has stopped “regularly” intervening in the foreign exchange market but allowed it could conduct “effective management” of the yuan in extreme volatility.

US politicians have responded by accusing Beijing of unfairly supporting its exporters.

Read more: China’s yuan drops for a third day | euronews, economy

China devalues yuan to lowest rate against US dollar in almost three years

China’s central bank has devalued the yuan to its lowest rate against the US dollar in almost three years and its biggest one-day drop since 1994 when China aligned its official and market rates.

The lender cut its daily reference rate 1.9 percent calling the change “ a one-off depreciation”.

The move comes as policy makers stepped up efforts to support exporters on the back of data earlier this week which showed exports tumbled by 8.3 percent in July. The lender said its fixing will become more aligned with supply and demand.

“As a result of the strong yuan, because it is linked to the US dollar, Chinese exports have become very expensive. There was a study that in 10 years, China’s cost increased by eight and a half times, so China’s manufacturing cost is only marginally lower than the US,” said Francis Lun CEO, GEO Securities Limited

The move could help spur growth in the world’s second largest economy which is growing at its slowest rate for six years.

Some economists said the the devaluation was also designed to support Beijing’s push for the yuan to be included in a basket of reserve currencies known as Special Drawing Rights which are used by the International Monetary Fund to lend money to sovereign borrowers.

Read more: China devalues yuan to lowest rate against US dollar in almost three years | euronews, economy

Time Magazine: The Exaggerated Fuss over U.S. Dollar Devaluation?

For the complete report from Time Magazine click on this link

The Exaggerated Fuss over U.S. Dollar Devaluation?

European governments insist that the U.S. devalue the dollar by raising the official $35-per-oz. price of gold. The U.S., just as adamant, is opposed to such a move. It demands that the Japanese and Europeans revalue—that is, make their currencies costlier in terms of the dollar.It is an Alice-in-Wonderland dispute. What would be the difference between a currency realignment accomplished by 1) foreign revaluations alone or 2) U.S. devaluation combined with inevitable foreign revaluations? "Economically, it doesn't matter two hoots," says Yale's Robert Triffin. Either way, the end result would be the same: the dollar would buy fewer yen, marks, guilders and other strong currencies. Theoretically, it is true, U.S. devaluation would also make the dollar worth less in terms of Brazilian cruzeiros, Chilean escudos, Indonesian rupiahs and 100-odd other weak or minor currencies.