The People’s Bank of China (PBoC), the Chinese central bank has now depreciated the yuan fix for eight consecutive days. Every day before trading opens, the PBoC releases the mid-point of the yuan fix, from where the currency is allowed to trade for the day within a 2 percent band on either side. Today PBoC has set the yuan fix today at 6.8495 per dollar, which is the weakest level of a fix since December 2008. The last time, the yuan fix was set at a stronger level was back in November 3rd and since then the yuan has weakened almost 1.5 percent. This week, the yuan fix is down around 0.56 percent.

The weakness of the yuan would pose a major threat to some Asian economies like Japan and South Korea for which the China is a major competitor in the export market as well as one of the main destinations for their exports. Some of the analysts have expressed worries over the weakness of the yuan as they suspect that with dollar getting stronger the outflow of money from the Chinese economy has increased once again.