FXStreet (Guatemala) - Analysts at Rabobank explained that the reality of slower Chinese growth has been in the back of investors’ minds for some time.
Key Quotes:
"However, it took the devaluation of the CNY last month to shock the market into facing up to the risk, not just of slower growth in China but from emerging markets economies overall. One month on and the dust is starting to settle. Over the past week, the JPY has been giving back some of its safe haven derived gains and the AUD has edged off its lows."
"Over the coming week the FX markets will be buffeted not just by the next round of Chinese economic data but by the September policy decision of the Federal Reserve. Not all economies will be equally impacted by the interest rate settings of the Fed and some, more than others, will feel the force of the China slowdown. Therefore we expect that in the weeks and months ahead investors will become extremely discerning about which currencies they invest in. "
"We continue to expect that EUR/USD can trend lower medium-term. However, the EUR is likely to remain well supported against a host of other currencies."
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