From Mises.org: Why Devaluing the Yuan Won’t Help China’s Economy

yuan

In an article on Daily Mises, Frank Shostak writes about how the recent devaluation of the Chinese Yuan will not help stabilze the Chinese economy. While the devaluation helps the overall GDP, it will eventually lead to higher prices and less imports and results in what he terms as “economic impoverishment”. The scenario of more exports and less imports leads to the economic impoverishment in the form of a decrease in real wealth, by means of the price of goods and services to the Chinese people increasing.

Read the Mises Daily article: Why Devaluing the Yuan Won’t Help China’s Economy