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Market Commentary Changes to Chinese Currency Policy – Update

Fourth Quarter 2016

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  • – Daniel Duncan and Andrew Foster provide an update to their August 2015 video that addressed China’s steps to liberalize how its currency trades against the U.S. dollar. Andrew notes that, just over one year later, China is rolling back some of those liberalizations. He describes a detailed set of recent policy measures that collectively constitute a tightening of the capital account in China – or, in other words, a restriction on the degree to which individuals inside and outside China can freely exchange the Renminbi for other currencies. Andrew suggests that these policy changes are signs of strained liquidity conditions, and that risks in China’s financial system are consequently elevated. He notes that the Fund continues to invest in China, but Seafarer is monitoring the Fund’s China-related exposure.

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    • The views and information discussed in this video are as of the date of publication, are subject to change, and may not reflect Seafarer’s current views. The views expressed represent an assessment of market conditions at a specific point in time, are opinions only and should not be relied upon as investment advice regarding a particular investment or markets in general. Such information does not constitute a recommendation to buy or sell specific securities or investment vehicles. It should not be assumed that any investment will be profitable or will equal the performance of the portfolios or any securities or any sectors mentioned herein. The subject matter contained herein has been derived from several sources believed to be reliable and accurate at the time of compilation. Seafarer does not accept any liability for losses either direct or consequential caused by the use of this information.
    • Daniel Duncan is a Registered Representative of ALPS Distributors, Inc.
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