The Yuan dominated the newswires last week as the move by Chinese policymakers to devalue the local currency sent markets into a veritable frenzy. A recent stretch of bad economic data including disappointing export numbers and slowing investment contributed to the latest policy shift. Higher than anticipated food inflation is preventing the People’s Bank of China from adding monetary stimulus in the form of further interest rate cuts or slashing reserve ratio requirements. This is not currently feasible considering the potential contribution to higher prices. The move prompted retaliatory calls from both the European Central Bank and Bank of Japan as the Central Banks remain intent on keeping their own devaluation plans intact. This is expected to lead to increased asset purchases from the ECB, especially considering the downtick in inflation which saw monthly consumer price measures in deflationary territory while GDP growth remains elusive. Commodity prices fell broadly, led by the precipitous drop in crude oil while gold and precious metals managed to outperform the asset class on the back of a softer US dollar.