Immediately, the move means China will pay for oil, copper, coal and other commodities with cheaper yuan. It may also imply that authorities are worried about the Chinese economy weakening more than the already disclosed dip in gross domestic product growth to an annual 7 percent clip in the first half of the year, leading to lower demand for commodities.
The second part of that equation is one reason why oil dropped 4 percent on the news. Copper dropped 8 percent. That's great if you're filling your tank in the U.S.—or making pennies. (Chinese airline stocks got hit hard, as investors factored in the effect of paying more yuan for fuel but discounted the effect of cheaper crude). But less-valuable Chinese currency is not so good for exporters who want to sell manufactured goods that include copper, for example, or that are made in factories powered by Australian coal.
The impact on their costs will cut into any benefit they get from selling their goods more cheaply to dollar-using buyers.