USDHKD PEG and the Chinese Currency..

28 Mar 2019

Unsurprisingly, right as the USDHKD Peg hit it's 7.85 limit, China lost its ability to prop up the Yuan, and the Yuan started to fall once again. This is further confirmation that the Yuan is subject to dollar pressure, and Hong Kong is China's "release valve" for dollar funding pressures. When the peg gets hit, the CCP has a difficult time keeping the RMB afloat.