Chinese RMB Will Continue To Depreciate: Morgan Stanley

With outflows replacing inflows and additional risk factors, Morgan Stanley analysts believe the Chinese renminbi will depreciate against the USD on a fundamentals basis, and any tactical stabilization of the RMB should likely be short-lived. Chetan Ahya and team at Morgan Stanley in their January 11, 2016 research note titled: “RMB Regime Change: Part 2” continue to recommend avoiding old economy China names and HK-listed China banks. RMB to move to greater depreciation path from 3Q16 on Ahya and colleagues note that on August 11, 2015, policy makers took up a shift to a new currency management regime, from managing…