Sinocism Live All about the RMB with Robin Brooks
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Jul 2, 2025 
Robin Brooks, a Senior Fellow at the Brookings Institution and former Chief Economist at the IIF, dives into the complexities surrounding the Chinese renminbi. He discusses how the RMB's devaluation post-tariff announcements shaped U.S. financial responses, potentially altering the trade power balance. The conversation highlights China's strategic leverage in negotiations and the implications of U.S. sanctions. Brooks also reflects on the broader impact of currency fluctuations on global markets and the risk they pose to emerging economies.
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Robin's 2015 RMB Devaluation Anecdote
- Robin Brooks was on vacation when China devalued the RMB in August 2015, and immediately had to handle market repercussions.
- This devaluation was small by global standards but huge for China because their currency is tightly managed.
China's Small RMB Move Destabilized US Treasuries
- A tiny 0.2% RMB devaluation after April 2nd caused major turmoil in the U.S. Treasury market.
- This was because emerging markets sold Treasuries to defend their currencies, cascading from China's currency move.
China’s Leverage Over U.S. Financials
- China holds massive leverage over the U.S. due to vulnerabilities in U.S. Treasury markets.
- A small move in RMB value triggers large U.S. market volatility, forcing policy changes.