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Gold/Mining/Energy : Gold Price Monitor

GDXJ 124.11

-13.6%

Jan 30 4:00 PM EST

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To: long-gone who wrote (39266)	8/20/1999 8:47:00 AM
From: Rarebird	Read Replies (1) of 116950

Chinese Devaluation Looming NEW YORK, Aug 19 (Reuters) - A Natwest Global Financial Markets analyst said he told bank clients in a telephone conference call Thursday that deflation and poor economic growth may prompt China to devalue its renminbi (yuan) by about 15 percent, possibly in the next 35 to 45 days. China faces ''basically a deflation problem and economic growth problem,'' the analyst told Reuters when recounting the teleconference. Talk of a devaluation by China has swirled around global financial markets over recent weeks, but the analyst at Natwest said he warned the bank's customers that ''the longer they delay it, the longer it is going to take for a domestic economic recovery to set into motion.'' Concerns about slower growth of four to five percent over the next few years and imbalances in the nation's economy prompted Standard & Poor's to lower China's sovereign rating to double-B from double-B-plus in July. The yuan is technically held in a managed float system, but in practice China has kept it pegged firmly at around 8.28 yuan to the U.S. dollar. The Natwest analyst said expectations of a devaluation may actually be holding off investors from China until the devaluation has occurred and news of it has been digested by global markets. ''The devaluation hanging over the market like Damocles' sword is not a good thing,'' the analyst said. biz.yahoo.com

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