US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP
US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP
Zhou Xin
Opinion

Opinion

Zhou Xin

China’s yuan rally has just started, and it is thanks to the US Federal Reserve

  • China’s 10-year government bond offers a yield of 3.2 per cent against an August consumer price index of 2.4 per cent, resulting in a positive real yield
  • In contrast, the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the interest rate is negative

US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP
US Federal Reserve chairman Jay Powell said the US is on track to reach its 2 per cent inflation target when the 10-year US Treasury bond is yielding 0.78 per cent, meaning the inflation-adjusted US interest rate is negative. Photo: AFP
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Zhou Xin

Zhou Xin

Zhou Xin co-leads the political economy team at the Post. He mainly covers economic stories but also writes about Chinese politics and diplomacy. He has previously worked for Reuters and Bloomberg in Beijing.