Move Over Yen, Yuan Carry Trades Could Be Next Ticking Bomb, Warns Strategists: 'But It's Below The Danger Levels We Monitor'
Portfolio Pulse from Shanthi Rexaline
Strategists warn that the unwinding of Chinese yuan carry trades could pose a new threat to global markets, similar to the recent yen carry trade unwinding. Citigroup strategists highlight that while the positioning in yen is not extreme, the yuan carry trades are still crowded. The iShares MSCI China ETF (NASDAQ:MCHI) saw a slight decline amid these concerns.
August 07, 2024 | 8:43 am
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The iShares MSCI China ETF (NASDAQ:MCHI) edged down 0.15% to $40.56 amid concerns over the potential unwinding of Chinese yuan carry trades.
The potential unwinding of Chinese yuan carry trades could lead to market volatility, impacting assets related to China. The slight decline in MCHI reflects investor caution.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80