China's influence over the global economic market continues to grow by the day. The country's economy, deemed to be second in the world next to that of the United States, is now seen as a crucial part of the global market, especially that of developing economies.
Since the start of the year, several global markets have tumbled. Market data revealed that the economy of Argentina, South Africa, and Turkey have all took massive damage that severely affected their growth. There are also growing concerns regarding the spread of this economic downfall on some Asian territories.
A report from Bloomberg stated that Federal Reserve Chairman Jerome Powell will not slow the current pace of monetary tightening. A decision viewed by many as one of the major factors that cause a lot of stress across many developed economies.
There is also a growing concern with regards to China's economic slowdown. Many market analysts have said that if this trend continues to grow, China's economic slowdown will affect a lot of developing economies in the world. This possibility is raising a lot of concern especially after the recent threat from United States President Donald Trump who plans to impose new tariffs against Chinese imports.
President Trump has publicly stated that he intends to levy a new set of tariffs against Chinese goods. The new tariff will cost as much as $200 million and is expected to take effect by next week.
Two decades ago, during the Asian crisis, China only represents 3 percent of the global economy. Following the company's economic boom, China now makes up close to 15 percent of the global economy. China is also a major trading partner to many emerging economies.
Due to this massive influence, many market experts have respected the country's role in stabilizing the global economy. During the Asian financial crisis, many experts have lauded China's decision not to devalue the Yuan in order to prevent a more massive fallout.
Based on the latest market figures, the Yuan was pegged at about 6.84 level compared to its closest rival, the dollar. Despite this recent improvements, the value of the Yuan is still at a crossroads. Many experts believe that should the U.S. decides to push through with its latest tariff threats, it will have serious repercussions with regards to the Yuan.
Experts are predicting that the Yuan will end 2018 at 6.95 to the U.S. dollar. Moreover, the People's Bank of China is also reintroducing several stability measures in order to make sure that the Yuan remains secure.
