The Phase One trade deal signed this week includes commitments by China to refrain from competitive devaluations and widen market access for US non-bank financial institutions (NBFIs). We doubt the former marks a major shift in exchange rate management by the PBOC, which has already pared back its FX intervention in recent years. And with the playing field still tilted against foreign firms it remains to be seen how successful US NBFIs will be in capturing market share from their Chinese rivals.
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