Yuan weakens as china becomes the new greece

Photo: Japanexperterna.se

China has become the new Greece in the world economy, as the country's currency devaluates following financial jitters.

The Chinese economy has showed increasing signs of slowing down, with stocks plunging in recent months, sparking economic fears inside the country and overseas. Indeed, China has become a major driving force in global markets, as investors increasingly turn to real estate abroad for reliable profits and more stable assets.

This week, the Yuan devaluated too, adding further to concerns and sending prices of assets lower.

What impact will it have upon overseas markets? The weaker Yuan means that spending power for Chinese buyers will be reduced, although Knight Frank notes that the currency remains stronger that it used to be against the pound 12 years ago.

The agency notes that concern surrounding China's economy and its impact upon wider markets has already caused buyers to postponse decision-making. Nonetheless, just as the Greek crisis encouraged buyers to turn to safe haven assets, Knight Frank also reports evidence that Chinese buyers have stepped up interest in London, with "golden postcode" areas, such as Mayfair, in demand.

"The uncertainty has also had an impact on sales volumes though transactions have begun to pick up again since December’s surprise increase in the rate of stamp duty for properties worth more than £1.1 million," adds the agency.