Yuan extends decline amid pol­icy hopes

China Daily (Canada) - - FRONT PAGE - By BLOOMBERG

China’s yuan ex­tended a decline from the low­est level in more than two years amid spec­u­la­tion the gov­ern­ment will take fur­ther steps to sup­port the econ­omy af­ter cut­ting in­ter­est rates for the sec­ond time in three months.

The Peo­ple’s Bank of China may lower bor­row­ing costs be­fore May and re­duce the ra­tio of de­posits that lenders must set aside, ac­cord­ing to the Industrial and Com­mer­cial Bank of China Ltd and China Mer­chants Bank Co Ltd.

“The yuan is be­com­ing less and less at­trac­tive com­pared with the dollar,” said Xiang Chu, a Shang­haibased for­eign-ex­change an­a­lyst at Industrial Bank Co. “In­vestors are ex­pect­ing the gov­ern­ment to an­nounce more eas­ing poli­cies, which will lead to fur­ther yuan de­pre­ci­a­tion. And that is en­cour­ag­ing them to sell the yuan.”

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