Yuan Soars to Fresh Multi-Year High as Markets Eye Fed, BOJ Decisions
The Chinese yuan has reached a fresh multi-year high against the US dollar, with the currency strengthening to 6.7039 per dollar in early trade on Monday. This marks its strongest level since February 2, 2023.
According to analysts at CICC, Federal Reserve policy developments could have a significant impact on the yuan exchange rate. If the FOMC meeting outcome is dovish, they believe the yuan could strengthen past 6.70; otherwise, it may continue to hover around current levels in the near term.
The People's Bank of China set the midpoint rate at 6.7698 per dollar before the market opened, below the 6.77 threshold for the first time in more than three years. However, traders and analysts noted that the central bank has been gradually lowering its official daily yuan guidance with a bias suggesting it is allowing some depreciation.