Connect with us

Asia Pacific

Unlike Indian Rupee, Chinese Yuan Will Have Zero Impact Due to Turkey Crisis

Published

on

Unlike the Indian Rupee, Chinese Yuan will have no impact due to the ongoing Turkish Crisis. The weakening of Turkish lira will not impact the Chinese Yuan as much as it will hit the India Rupee or the South African Rand, as Beijing maintains stringent controls over capital outflows and also has ample foreign exchange reserves, according to experts talking to Global Times.

Turkey’s economic troubles got worse after US President Donald Trump declared on Friday that taxes on Turkish steel and aluminium would be doubled. The Turkish lira depreciated by about 20% the same day and also impacted the global stock markets and emerging markets’ currencies.

The Indian Rupee slumped to a new low of 70.08 rupees against the US dollar. It depreciated further on Wednesday, although the Reserve Bank of India reportedly spent $23 billion to help sustain the foreign exchange market.

The Argentine Peso also hit an all-time low, trading at 30.36 per dollar as of press time on Wednesday. The country’s central bank on Monday also increased its key interest rate from 40% to 45%.

China’s Yuan traded lower on Wednesday, and its onshore price touched 6.9118 against the US dollar, the lowest since May 2017.

The severe currency fluctuations have added market anxieties+ about whether there could be a domino effect from the Turkey situation that might hit currencies in developing markets, including India and China

“The market at first tends to over-react and investors quickly sold the currencies of emerging economies like India to stay away from possible losses. However, “Turkey is not an international economic hub. It is not even a member of the European Union. The country’s financial market also has minimal links with other nations, so the panic sentiment will calm down sooner or later, according to experts.

“A general concern for emerging economies has been a currency mismatch – when the dollar strengthens, assets in those countries are sold to gain short-term profits, ramping up devaluation stress on local currencies. However, China does not have this issue because of its stringent restrictions over capital flows and its sturdy economy.

The situation is not as good for India which has long experienced trade deficits and has had to draw foreign capital in the form of foreign debts which has made India more exposed to external market fluctuations.

More News at EurAsian Times

Advertisement
Advertisement

Facebook

FEATURED

S400-VS-F35 S400-VS-F35
Americas2 hours ago

Inside America’s Trillion Dollar Disaster – How The US’ F-35 Jets Emerged From The Ashes?

The United States currently houses the most sought after and probably the most potent fighter jets in the world, the...

TURKEY TURKEY
Featured3 hours ago

Armenia Threatens To Shoot-Down Turkish F-16s With Russian Iskandar Missiles

In a severe escalation of tensions between Armenia and Azerbaijan, Armenian Ministry of Defense reported that an Armenian jet was...

Sargsian-Armenia Sargsian-Armenia
Expert Reviews12 hours ago

Armenia-Azerbaijan Conflict: Why Armenia Needs To Pull-Out From Occupied-Regions Of Azerbaijan: OPED

The Armenia-Azerbaijan Upper-Karabakh conflict was sparked with the open territorial claims of Armenians to Azerbaijan's historical lands, as well as ethnic provocations in...

AMCA-DRDO AMCA-DRDO
Featured12 hours ago

Indian 5th-Gen Aircraft To Be Fast-Tracked As DRDO, French Tech Giant Safran Set To Join Hands

As India looks to build its future fifth-generation fighter within its national boundaries, the country’s Defence Research and Development Organisation...

rafale-jets rafale-jets
Europe13 hours ago

4.5 Gen Rafale Fighter Jets Find A Freakish Challenger In Ageing Italian AV-8B Harriers

With Greece set to receive its Dassault Rafale fighter jets from France, Turkey has also been beefing up its defence...

Capital-of-Israel-Jerusalem Capital-of-Israel-Jerusalem
Featured16 hours ago

How Sworn Enemies Pakistan & Israel Are Supporting Azerbaijan While Armenia Gets Russian & Indian Backing?

The tensions between Azerbaijan and Armenia are at its peak with deadly attacks that shook the Armenian-controlled Karabakh in the...

F-35-INDIA F-35-INDIA
Americas1 day ago

Not F-35 Jets or F-22 Raptors, This Is The World’s 1st Stealth Aircraft & Still The Fastest Ever

The United States along with Russia are front-runners when it comes to devising modern technology and blending it with state-of-the-art...

INDIA-CHINA INDIA-CHINA
Asia Pacific1 day ago

China Could Soon Deploy ‘Unmanned Helicopters’ In Ladakh As Tensions Mount With India

With the diplomatic and military talks in progress between the high ranking officials of New Delhi and Beijing, Indian and...

Capital-of-Israel-Jerusalem Capital-of-Israel-Jerusalem
Featured1 day ago

Three Islamic Countries That May Never Recognize Israel Despite The Acceptance Of Saudi Arabia?

In the wake of the ongoing developments, when clouds of war are hovering over India and China / Pakistan, perhaps...

missile missile
Featured1 day ago

Russian & Israeli Origin Missiles Deployed In Ladakh As India Looks To Keep China At Bay

Amid heightening tensions in Eastern Ladakh with China, India has reportedly deployed BrahMos and Nirbhay cruise missiles along with Akash...

Advertisement