Donald Trump, the President of the United States, has blamed China for deliberately devaluing its national currency (Yuan) to reduce the impact of tariffs imposed by the United States on Chinese goods. By lowering the value of the Yuan, the prices of Chinese goods in the global market decrease, resulting in the US customs tariffs having less impact on the final prices of those goods. Consequently, China is trying to keep its exports competitive. Trump has warned that this strategy could backfire on China as currency devaluation may lead to capital flight, economic distrust, and increased domestic inflation. This issue has further escalated the trade tensions between the US and China, with experts warning of the possibility of a currency war.
