USD/CNY pushes above 7.30 for the primary time since late 2023

With Trump persevering with to threaten tariffs, one can moderately anticipate the yuan to be China’s first line of protection towards that. From final month:

• Is that this Beijing’s first line of protection towards Trump?
• China is contemplating to permit the yuan to weaken subsequent yr as commerce dangers loom – report

The case is definitely constructing and the query now is not if the yuan will weaken. However as a substitute by how a lot will it weaken in the course of the course of buying and selling this yr.

Beijing appeared to have drawn a line within the sand up to now few weeks slightly below 7.30 however at present, they’re beginning to let that slide.

The 2023 excessive got here in slightly below 7.35 and once we do get a run above that, there will not be a lot of a precedent as that may take USD/CNY again to its highest ranges since 2007 – just some years after shifting to a “floating change price” system.

This text was written by Justin Low at www.ubaidahsan.com.



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