The WOCU and the 'un-pegged Yuan'
WDX, like all market practitioners, has noted with great interest the PBOC announcement of a gradual “un-pegging” of the Yuan against the US Dollar. We look forward to how this move will unravel.
The Yuan is a major component of the Wocu basket – indeed, if Goldman Sachs growth forecasts are to be believed, China will rival the US as the largest GDP within 15 years. The dynamic nature of the WOCU’s calculation and its re-balancing will ensure that it adjusts in line with real, fundamental changes.
The Yuan can be viewed in real time from the password-protected pages on our home page. It is interesting to note that since January 1st, this year, the Yuan has moved from 11.850 to a high of 11.075 versus the WOCU – an increase of 6.5%, in Wocu terms.
Today the rate is 11.2325.