Today China dropped its policy of linking the Yuan to the dollar in a fixed exchange rate. For the past ten years the yuan traded at 8.277 to the dollar. As of today the value of the yuan trades at 8.11 yuan, which is still a state-set value but is moving towards a more market-based value based on a series of values in relation to the larger European currencies.

Many people - US lawmakers included - have been pressuring China for years to remove the fixed status of the yuan and have it float on the currency market. It’s been claimed that the Chinese government has undervalued the yuan as much as 40 percent giving Chinese exporters unfair advantages based on conversion.

The dollar is down against the Japanese yen - the bellwether of the Asian economy - on the news.