People's bank of China (PBoC) has devalued Yuan for seventh consecutive day, while the Yuan trades at four year low against Dollar. PBoC has fixed Yuan's central parity today, down -0.1% to RMB 6.4995 per Dollar. Onshore Yuan, which is restricted to trade within 2% band either side of the central parity, is currently trading at 6.48 per Dollar, while its onshore counterpart mainly traded in Hong Kong and subject to no restriction, trading at 6.546 per Dollar.

PBoC's continued devaluation of Yuan has raised some fears that China might be joining the currency war and devaluation is deliberate.

We at FxWirePro, agree to few facts,

• A strong Yuan against not only Dollar but global currencies may not be in China's interest.
• China, after IMF decision minding less to the devaluation of Yuan.
• China might join in the currency war, at some point in future.
• Hard landing in China's corporate debt may lead to much weaker Yuan.

However, at this point, we feel, fear arising from last seven trading days of devaluation, that China joining in the currency war or suggestions that devaluation is deliberate may be pre-mature. That is because PBoC's approach to Yuan and monetary policy are on the change path, which we discussed here at http://www.econotimes.com/Renminbi-series-%E2%80%93-PBoCs-change-in-approach-to-Yuan-130457.

Those who could remember PBoC's statement during August devaluation could better relate to what we imply.

PBoC indicated from August 11th, it will give greater voice to market by taking into account spot market close in off-shore Yuan and other currency movement, while setting the daily fix.

Yesterday, offshore Yuan, dropped against Dollar and closed at 6.5489 per Dollar, which is much weaker (-0.75%), weaker than today's fix.

So, if anyone is to blame for Yuan's decline, it's the market (probably banks too), which is not unusual, since Dollar demand is high ahead of FED decision tomorrow.