Goldman Sachs downgrades view on Chinese Yuan from 'cautious' to ‘outright negative’

Analysts at Goldman Sachs downgraded their outlook on the yuan, shifting from a more cautious stance to a negative one at present.

Key Details:

Have now downgraded view on yuan to 'outright negative'

Further weakening of the yuan against the USD could lead to tighter financial condition (including lower US stock prices) and then for the Fed raise rates at a slower pace

The risk is that this re-ignites capital flight in the same manner it did in August (during the mini-devaluation) and around the turn of the year