What if the PBOC devalues the yuan past 7.5 to the dollar?
A managed-yuan break past 7.5 exports deflation and triggers an Asian-FX domino: the cleanest trade is short copper and China megacaps as the devaluation signals demand weakness, with an AUD and KRW/TWD selloff alongside. Direct rhyme is the August 2015 CNY 'reform' devaluation and the August 2019 break of 7 that earned the manipulator label and a global risk-off. Forward: a weaker starting growth base means deflation export bites trade partners harder than 2015.
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The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. Loading the probability audit trail…
What it would mean
If this plays out, it is a mixed shock. The PBOC engineers a sharp managed-yuan devaluation past 7.5, exporting deflation and triggering an Asian-FX domino selloff. The trigger decomposes into signed root‑shocks — China growth ▼ · Trade tension ▲ — which propagate through our causal graph to the markets below.