Yuan Watch : Sucker at the table

On December 31:

Morgan Stanley says emerging market (EM) currencies are 'summer' currencies that do not perform well in 'winter' while euro – historically a "winter" currency – will suffer because of possible fractures in Eastern Europe.

"EM currency 'moment' is not over, in our view," it said. "In fact, the process is roughly halfway complete. We see weaker Latam currencies in the first half. Pressures on AXJ currencies will likely persist, as these countries' exports collapse and their central banks cut interest rates. We believe that even the Chinese yuan will be allowed to weaken against the dollar in the coming months."

On January 9th:

By Judy Chen and Patricia Lui
Bloomberg
Morgan Stanley recommended buying the Chinese yuan, the South Korean won and the Mexican peso as an easing in the global shortage of dollars causes the U.S. currency to weaken.

“Among the currencies that bore the brunt of the dollar rally last year, the won stands out now as a potential top performer,” Yilin Nie, a New York-based strategist, wrote in a Jan. 8 report “Also, despite the hard landing that may face the Chinese economy, the yuan is still likely to continue a modest path of appreciation.”