China walls come tumbling down

THE ALCHEMIST

Good news for investors bullish about emerging markets, and China in particular.

The long-awaited announcement, seen by many as the real start of Asia’s economic revival, of China dropping the peg against the dollar of its renminbi or yuan currency, occurred last week. Immediate positive response from regional markets, as well as global investors feeling battered from the gruelling European sell-off since May. The renminbi peg was put in place during the market turmoil of 2008, and its removal is a clear sign of confidence in economic recovery. But as ever with Beijing, there is a longer game in play as well. The announcement comes just before the Toronto meeting ...