China’s yuan is already at its weakest level against the dollar in over two years. But it might be poised to fall further still: Two major factors holding it up so far in 2022 look likely to reverse. Like most emerging market currencies, the yuan has been pummeled this year by the combination of a hawkish Federal Reserve and worries over slowing global growth. Even so, the yuan’s fall in recent months is striking. On Monday, China’s central bank raised the risk reserve institutions must hold when selling forward currency contracts, making it more expensive to bet against the yuan.

---