![How 'Brexit' Will Impact China's Economy](https://cdn.prod.website-files.com/5a3e922cf6b9a40001bc2d70/60b3da6e9d53e4182d9f4956_How%20Brexit%20Will%20Impact%20China%27s%20Economy.jpg)
David Dollar gives you fresh insights to better incorporate Brexit's impact into your analyses of China and global economies & markets, including:
1. Why, after the Brexit vote, did the Shanghai Stock Market fall only 1%?
2. How will Brexit affect the value of the RMB and China's currency policy?
3. How will Brexit impact trade with the EU, China’s largest trading partner?
4. Why, in the larger geopolitical perspective, could China be the big winner from Brexit?
Key Takeaways
- Brexit has little direct effect on the Chinese economy—but its does reinforce the trend for exports to decline in importance.
- Brexit increases the risk of financial volatility—and the downside risk of unruly devaluation as China works to stabilize the RMB exchange rate with respect to a volatile basket of currencies.
- In the long run it is hard to see Brexit as anything but a plus for China as the West continues to decline and China continues to rise.