Here is what a US-China 'currency pact' would mean for the dollar and the yuan

Author: Eamonn Sheridan | Category: Central Banks

Morgan Stanley (this via Bloomberg) say a pact is likely to weaken the USD and strengthen the Chinese yuan.

Well, yeah. 
  • could lead to broad based USD weakness, especially benefitting China-proxy currencies
  • yield curves would get steeper
  • yen would weaken
MS say it'd be a 'Plaza Accord' lite. 

A bit of a summary if its of interest. 
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