The CNY has won in front of the USD lately, but it is more a story about the weakening of the USD than about the strength of the CNY. The difference in rates between the US and China has been reduced, since the weakest data of the United States have pushed the yields of the American bonds, Danske Bank’s currency analysts report, Kjristofer Kjær Lomholt and Filip Andersson.
The PBOC maintains the type of reference USD/CNY stable around 7.17-7.18
“The PBOC continues to maintain the type of reference USD/CNY stable around 7.17-7.18, in line with its repeated message of preference for stability. It has surprised us that they have not allowed the type of reference to increase after the 20% increase in US tariffs, but suggests that they are interested in maintaining the stable crossing.”
“Perhaps not to antagonize Trump and risk more tariffs, but probably also to provide an anchor of stability in a world instead, as they have done before, for example, during the Asian crisis in 1997/98. This puts some downward risk in our forecast of 7.60 to 12 months. With the relative stability in the USD/CNY, the changes in the EUR/USD are transmitted directly to the cross EUR/CNY and, therefore, we have seen that it moves up with the increase in the EUR/USD. ”
“As we still see the USD winning in the medium in the long term, the weakest current levels of the CNY should be considered to cover expenses. No less, since the world has become more unpredictable and currency movements can be quickly reversed, as we have recently seen.”
Source: Fx Street

I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.