Market turmoil: All because of China ?

The photo shows Chinese 100-yuan notes (15.5 USD). (AFP Photo)

August is best remembered now for the fall of stock markets, reminiscent of the 1987 crash that the Dow Jones experienced in the US. All are pointing the finger at China, but is it all due to China?

China triggered the market slide since it devalued its currency, the renminbi. The drop then is the result of the fear of the macro situation in China. The figures in China were less than expected.

After all, China is one of the largest contributors to the world's economy. But market growth itself has been slack, standing roughly at 23%. The oil price indicates that production is not there. So, it’s a combination of the bull market and a lack of activity which justify the sell-off.

But China could have meant to dent the dollar's value in order to make the yuan the floating currency, which is why there is speculation that this spells a currency war.


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