The UK winners from China's currency devaluation

After years of pegging its currency to the dollar, China has taken the unexpected step of allowing its currency to depreciate. It is unclear exactly how much the renminbi will be allowed to fall, but there have been tangible consequences on global investments already.

In the UK, many companies banking on strong Chinese sales growth were shunned by investors. Luxury retailer Burberry fell more than 7% on the 3% slide in renminbi that started on 11 August, while consumables giant Unilever lost almost 5%. The group's forecast revenues were suddenly worthless and many commentators worried the Chinese government may be on a path of a 10% to 20% competitive devaluation against the dollar. If that comes to pass, imported products will be significantly more expensive for Chinese punters, meaning they will either buy less or foreign companies will have t...