“Soros’s war on the renminbi and the Hong Kong dollar cannot possibly succeed – about this there can be no doubt,” said the article titled “Declaring war on China’s currency? Ha ha,” published by People’s Daily, the official newspaper of the Chinese Communist Party.
The opinion piece is an attempt to convince investors that the renminbi is still a safe choice despite the currency’s 5.7 percent tumble since August. Meanwhile, China’s central bank has been dipping into its foreign exchange reserves and spending hundreds of billions of dollars trying to halt the currency’s slide.
China zeroed in on Soros after he told Bloomberg TV last week that he is betting against the S&P 500, Asian currencies, and resource-linked economies. Soros also said he is projecting a hard landing for China’s economy, highlighting it as one of the “root causes” of the risk-off market sentiment.
“The Chinese left it too long to address the changeover in the growth model that they have to adapt from – investment and export-led to domestic-led. So a hard landing is practically unavoidable,” he said on the sidelines of the World Economic Forum in Davos, Switzerland. “I’m not expecting it, I’m observing it.”
Georges Soros, Chairman of Soros Fund Management. © Charles Platiau / Reuters