Hedge fund urges 50% Yuan drop

Mark Hart, the hedge fund manager whose bets against US subprime mortgages and European sovereign debt proved prescient, said China should weaken its currency by more than 50 percent this year.

A one-off devaluation would allow policy makers to "draw a line in the sand" at a more appropriate level for the yuan, easing pressure on China's foreign-exchange reserves and removing an incentive for capital outflows, according to Hart, who's been betting against the currency since at least 2011.

China should devalue before its $3.3 trillion hoard of reserves shrinks much further, he said, because the country can still convince markets it's acting from a position of strength.