US Dollar/Chinese Yuan FX Spot Rate

China's foreign exchange trading system, CFETS, reported that the yuan's central parity rate strengthened by 0.0060 yuan today to 6.7351 per US dollar. Xinhua News Agency reported that in China's foreign exchange market, the yuan is allowed to rise or fall by no more than 2% from the central parity rate for each day's trading. The yuan's central parity rate against the US dollar is based on a weighted average price before the interbank market opens for trading each day.

Mr. Poon Panichpibool, a strategist for money and capital markets at Krungthai GLOBAL MARKETS of Krungthai Bank, or KTB, said Krungthai Global Markets sees the baht facing two-way risk in the short term, depending on shifts in market players' views on the direction of US Federal Reserve policy and on developments in the highly uncertain situation in the Middle East. This means market players should use a wider range of hedging strategies, especially options strategies. During the day, the overall risk-off mood in financial markets could pressure Asian currencies to weaken, opening the risk that the baht could easily weaken to test the resistance zone of 33.50 baht per dollar, especially if foreign investors gradually resume selling Thai assets in greater volume. However, Asian currencies, particularly the Chinese yuan, may gain some benefit from the latest developments in the US-China leaders' summit, which concluded that the US side would extend the pause on import tariffs on China by another two months and may consider lowering the ceiling on import tariffs on Chinese goods. That picture could also help slow the baht's depreciation. In the medium to long term, the view remains that the Fed is likely to raise rates one more time at its December meeting before holding rates steady until the second half of 2027 and then gradually cutting them. That leaves room for the baht to gradually strengthen, because market players' expectations for Fed rate hikes remain somewhat higher than the assessed path. At the same time, the risk that the Fed could raise rates faster and by more than expected has increased, after energy prices threatened to keep rising if the situation in the Middle East heats up again and drags on longer than expected. Technically, assessed with a trend-following strategy, the baht remains in an appreciating trend on the weekly time frame until it clearly weakens past the 33.50 baht per dollar zone. On the daily time frame, the baht remains in a depreciating trend until it can clearly strengthen back past the 33.00 baht per dollar zone again.

China's yuan traded near its strongest level in three and a half years against the dollar today, September 22, as the market watches for a meeting between Chinese President Xi Jinping and U.S. President Donald Trump. The yuan was supported by the Chinese central bank's setting of a firmer-than-expected reference rate. The Chinese central bank set the yuan's reference rate at 6.7459 yuan per dollar, the strongest level since February 2023 and 0.0028 yuan firmer than the reference rate on Monday, September 21. Onshore yuan strengthened to 6.6947 yuan per dollar on Monday, its strongest level since January 2023, while offshore yuan strengthened to 6.6908 yuan per dollar. The strengthening came after the Chinese central bank allowed the daily reference rate to firm at a faster pace in recent weeks, narrowing the gap between the reference rate and market expectations. This may reflect that the Chinese central bank is more accepting of a gradual appreciation of the yuan ahead of this meeting. The two leaders are expected to discuss trade, artificial intelligence, supply chains and Middle East tensions at the meeting on September 23-25.

The Chinese yuan ended regular trading on the 21st at 6.6955 per dollar, its strongest level since June 30, 2022. Ahead of this week's US-China leaders' summit, the People's Bank of China has eased its stance against yuan appreciation. The yuan at one point hit 6.6950 per dollar, its strongest since January 16, 2023, while the offshore yuan traded about 0.03 percent higher in Asian hours at 6.6946 per dollar. Before the market opened, the PBOC set the daily fixing against the dollar at 6.7487, the strongest yuan level since February 3, 2023. For nearly a year the fixing had been set weaker than market expectations, which was read as the PBOC trying to curb the pace of the yuan's rise, but this month the fixings have increasingly leaned toward a stronger yuan, prompting the view that the central bank has eased its restraint. Goldman Sachs analysts noted that the strength of the fixing at a time ahead of the US-China summit is consistent with past practice, and that the room for the offshore spot rate to rise further has widened. OCBC, meanwhile, said caution is warranted in interpreting the PBOC's move as the start of a sustained cycle of yuan appreciation.

The People's Bank of China kept its benchmark lending rates unchanged at record lows for the 16th consecutive month in September 2026, meeting market expectations. The one-year loan prime rate, the benchmark for corporate and consumer borrowing, was held at 3.0%, while the five-year LPR, the reference rate for residential mortgages, stayed flat at 3.5%. The central bank maintained a cautious monetary stance amid heightened Middle East geopolitical tensions, as strong global demand for AI-related goods continued to support Chinese exports. Domestic equities edged higher after the decision, with the Shanghai Composite gaining 0.4% to 3,925 and the Shenzhen Component rising 0.8% to 13,743. In currency markets, the offshore yuan held firm near 6.69 per dollar, its strongest level against the greenback since July 2022.

The yuan strengthened to its highest level in more than four years today after China's central bank kept signaling support for the currency through a stronger daily fixing for an eighth consecutive day, the longest such streak since 2023. The offshore yuan rose as much as 0.1% to around 6.70 per dollar, its strongest level since July 2022. The rally comes ahead of a meeting between U.S. President Donald Trump and Chinese President Xi Jinping in Washington on Sept 24, where trade and economic relations are expected to remain a key topic of discussion. Meanwhile, Shanghai Clearing House began providing central counterparty clearing services on Sept 14 for spot transactions in Singapore dollars, New Zealand dollars and the Thai baht, with 12 banks participating and 996 million yuan in transactions entering the clearing system on its first day of operation, expanding the number of currencies able to access China's domestic central clearing network. Shanghai Clearing House already provides central clearing for yuan transactions involving the U.S. dollar, euro, pound, Australian dollar and yen. The yuan has remained firm even as the U.S. dollar strengthened after the Federal Reserve decided to raise interest rates, and despite signs that credit demand in China remains weak. Chinese banks extended only 60 billion yuan in new loans in August, far below the 400 billion yuan economists had expected, while outstanding yuan-denominated loans grew just 4.9% year on year, a record low.

China's foreign exchange trading system, CFETS, reported that the yuan's central parity rate strengthened by 0.0028 yuan today to 6.7670 per US dollar. Xinhua News Agency reported that in China's foreign exchange market, the yuan is allowed to rise or fall by no more than 2% from the central parity rate for each trading day. The yuan's central parity rate against the US dollar is based on a weighted average price before the interbank market opens for trading each day.

China's State Administration of Foreign Exchange has instructed banks to promote hedging of currency risk by corporate clients, according to multiple people familiar with the matter. The aim is to prevent mounting losses at exporters from a yuan that keeps rising against the dollar. The informal guidance, known as window guidance, was carried out over the past few months, with SAFE's local branches asking banks to raise the hedging ratio on customers' currency exposure, the people said. Some branches appear to have paid subsidies to companies that expanded hedging, covering part or all of the premium cost of currency options. Banks in coastal areas with concentrated export industries were urged to raise ratios to about 40 percent or more, while some banks in regions with relatively subdued trade activity were asked to lift hedging ratios to the national average. The yuan has risen about 4.3 percent against the dollar this year and is trading near its strongest level in about four years. Based on SAFE data, companies signed currency derivative contracts worth about 1.4 trillion dollars in the first half of this year, up about 40 percent from a year earlier. The nationwide hedging ratio stood at 35.3 percent, up 5.3 percentage points from the end of last year. Analysis by Goldman Sachs shows currency losses in the first half reached about 70 billion yuan, the largest in a decade, accounting for roughly 4 percent of total corporate profit, though the firm said that given the substantial profit growth of exporters, such losses remain at a manageable level.

Lu Lei, Deputy Governor of the People's Bank of China, said on the 10th that the central bank plans to further develop the offshore yuan market and expand liquidity as part of efforts to internationalize the currency. Speaking at a press conference, Lu said the PBOC will keep offshore yuan liquidity ample and stable and will regularize the issuance of government bonds and central bank bills in the offshore market, adding that "the internationalization of the renminbi is a sustained and steady process, and it is irreversible." The PBOC will create an environment that makes it easier for overseas entities to hold and use the yuan, and will actively promote the use of the digital yuan in cross-border transactions, he said. Lu noted that renminbi-denominated assets are becoming increasingly attractive to global investors, and said overseas entities currently hold more than 11 trillion yuan, or 1.64 trillion dollars, in onshore renminbi-denominated financial assets. He stressed that China aims to keep the yuan exchange rate basically stable and has no intention of gaining a trade advantage through a weaker currency.

Brown Brothers Harriman reports that the Chinese yuan is extending its uptrend against the US dollar, with USD/CNH drifting to its weakest level since January 2023. This comes as China's August Consumer Price Index rose modestly, keeping overall inflation subdued. The muted inflation data supports the yuan's strength, as it reduces pressure on the People's Bank of China to tighten policy. Elias Haddad of BBH notes that the currency's uptrend remains intact amid these conditions.

Hong Kong has unveiled its first five-year development plan, which includes expanding the use of the yuan outside mainland China and increasing cross-border investment connectivity with the mainland to strengthen its role as an international financial center. John Lee, Chief Executive of the Hong Kong Special Administrative Region, said the plan will expand offshore yuan investment and risk management products, as well as channels such as Stock Connect, Bond Connect, and Wealth Management Connect, aiming to align with mainland China's 15th Five-Year Plan. The Northern Metropolis project will be a key component in integrating universities with technology and industry. Lee will present the plan to the Legislative Council on September 16. Meanwhile, Hong Kong's financial regulators are preparing to address the use of AI in the financial sector, with Julia Leung, Chief Executive Officer of the Securities and Futures Commission, stating that risk management and leveraging AI will be prioritized.

U.S. Treasury Secretary Scott Bessent is set to urge G20 member nations to review trade terms with China, arguing that China's trade surplus of $1.2 trillion is unsustainable and pressing China to restructure its economy away from export dependence toward domestic consumption. Ahead of the G20 finance ministers and central bank governors meeting in Asheville, North Carolina, Bessent said the world cannot have a China with such a large trade surplus, and that China's weak economy is being propped up by exports. While U.S. tariffs under Trump have directly reduced imports from China, they have led to a shift of Chinese goods to Europe and Latin America. The U.S. is also pushing for a joint G20 statement to reduce trade imbalances and questioning proposals to strengthen the yuan or strike a Plaza Accord-style deal, viewing them as not addressing the real problem. Data from the U.S. Census Bureau shows that the trade deficit with China in the first six months of 2026 fell by about one-third to $73.9 billion. Bessent is scheduled to meet with Pan Gongsheng, governor of the People's Bank of China, and it remains unclear whether he will meet with Vice Premier He Lifeng before the Trump-Xi summit at the White House in late September.

Citi Research is questioning whether global currency policy is undergoing a major shift akin to the 1985 Plaza Accord, as Treasury Secretary Scott Bessent works to address imbalances through controversial interventions. While Citi sees no confirmation of a structural turning point, it notes that the U.S.-Japan currency alliance to reverse yen weakness could signal a change in global policy. In late July, the U.S. Treasury joined Japan in a coordinated intervention to support the yen after USD/JPY neared a 40-year high around ¥164 per dollar, using existing Exchange Stabilization Fund assets, reportedly including euros. Citi suggests that if yen weakness reversal contributes to a correction in yuan weakness, European nations might join the U.S. to demand China reverse yuan depreciation, though it doubts yen weakness can be easily corrected given its link to stock-market-driven yen-selling hedges. The interventions align with Bessent's proposed 'national economic policy'—dubbed the 'Bessent doctrine'—which shares with the Mar-a-Lago accord the goal of rectifying global imbalances, but Citi says they do not imply a weaker dollar, and future actions could involve other nations, likely focusing on China's current account and the yuan.

Shanghai is considering measures to subsidize foreign bond issuers in the FTZ Bond market by up to 2.2 million yuan per issuance, aiming to revive the sluggish market and promote the international use of the yuan. The measures, part of a plan that is not yet finalized, could cover various costs such as consulting fees and bank charges, and would be effective until the end of 2028 for bonds exceeding 200 million yuan with a minimum maturity of one year. Meanwhile, the People's Bank of China has allowed domestic banks to invest in FTZ Bonds through special accounts, limiting the proportion of onshore funds to no more than 50% per tranche. This move comes after the FTZ Bond market resumed operations last year following a three-year lull, with total fundraising of 7.1 billion yuan, though most came from Chinese-affiliated companies, and local government financing vehicles still account for 78% of the market. The measures also include support for green bonds and technology-related bonds such as digital yuan bonds, with the goal of positioning Shanghai as an offshore financial center competing with Hong Kong and Singapore.

After resuming 7-day reverse repos, the People's Bank of China stepped up liquidity injections, conducting 340 billion yuan of 7-day reverse repo operations on August 24, achieving a net injection of 340 billion yuan. The central bank also pre-announced on the same day that it would conduct a 500 billion yuan one-year medium-term lending facility operation via fixed quantity, interest rate bidding, and multiple price winning, and would carry out overnight reverse repo operations from August 27 to September 1, with daily operation volume not exceeding 600 billion yuan. This marked the second consecutive working day of injections after the central bank resumed 7-day reverse repo operations. Previously, on August 21, the central bank conducted 95 billion yuan of 7-day reverse repo operations, ending eight consecutive working days of zero net injection. Multiple institutions believe that the central bank's recent flexible mix of overnight and 7-day reverse repo tools reflects more precise liquidity management, aiming to protect funding conditions and prevent excessive upward movement in funding rates, while also guiding funding rates closer to the policy rate.

United Overseas Bank strategists Quek Ser Leang and Lee Sue Ann maintain a downside bias on USD/CNH after the pair dipped to 6.7180 and closed near 6.7210. They see the Chinese yuan strengthening toward the 6.7200 level against the US dollar.

OCBC analysts Sim Moh Siong and Christopher Wong say the Chinese yuan remains supported by a softer US dollar and exporter conversion, but the People's Bank of China is signaling a preference for gradual gains through its daily fixing.

China's central bank has signaled it will slow the yuan's appreciation after the Chinese currency hit its strongest level in more than three years. It set the daily reference rate at 6.7808 yuan per dollar, which was 598 pips weaker than the average forecast by analysts and traders in a Bloomberg survey, the widest gap since February. The move reflects that the PBOC wants to curb overly rapid appreciation by using the daily fixing mechanism as a signaling tool to the market. The offshore yuan strengthened to its highest level since February 2023 amid pressure on the US dollar, after investors scaled back expectations that the Fed would raise interest rates further and the US Treasury announced plans to increase the size of long-term government bond buybacks. Wee Khoon Chong, senior Asia-Pacific market strategist at BNY in Hong Kong, said he remains positive on the yuan over the medium term but expects the pace of appreciation to slow, noting that China's slowing economy, continued portfolio outflows, and rising demand for currency hedging are becoming greater headwinds for the yuan. However, China's large current account surplus remains a key fundamental factor supporting the yuan over the medium term.

China's central bank decided to keep the one-year loan prime rate, or LPR, at 3 percent and the five-year LPR at 3.5 percent at today's meeting, marking the 15th consecutive month of unchanged rates and matching market expectations. Analysts view the rate hold as a sign that Chinese policymakers may rely more on accelerating fiscal spending than on a new round of monetary easing to support economic growth, while Chinese commercial banks still face narrowing margins near record lows. The central bank said last week that it would maintain appropriately accommodative monetary policy and take effective measures as needed, but it has not given a clear signal about cutting policy rates or reducing banks' reserve requirement ratios, even though July data pointed to economic weakness from sluggish domestic demand, including industrial output, retail sales, and loan growth.

China is pressing ahead with expanding its digital yuan network, e-CNY, this year by adding 20 more participating banks, bringing the total number of banks in the network to 30. The People's Bank of China, or PBOC, is driving this expansion of the central bank digital currency, or CBDC, network. The addition of 20 new banks to the existing ones reflects efforts to accelerate wider use of e-CNY.

TCL Smart Home disclosed its 2026 half-year report. In the first half, total operating revenue reached 9.934 billion yuan, up 4.83% year on year. Net profit attributable to shareholders of the listed company was 512 million yuan, down 19.88% year on year. Basic earnings per share were 0.47 yuan. The company said the core reason for the change in net profit was exchange losses of 198 million yuan caused by RMB appreciation, with losses up 280 million yuan year on year.

According to a semi-annual survey by the Hong Kong Financial Markets Association, the US dollar/Chinese yuan pair overtook the Hong Kong dollar/US dollar pair for the first time in April to become the most traded currency pair in Hong Kong's foreign exchange market. Average daily foreign exchange turnover in Hong Kong rose to 908.2 billion US dollars in April, with average turnover in the US dollar/yuan pair expanding to 274 billion US dollars, accounting for about 30.2% of the total. In the previous survey, the figure was 198.6 billion US dollars. Average turnover in the Hong Kong dollar/US dollar pair also increased, reaching 240.2 billion US dollars. Amid rising geopolitical tensions, the Chinese and Hong Kong governments have rolled out a series of measures to strengthen currency, bond, and gold trading in Hong Kong, stepping up efforts to establish the city as a major hub for offshore yuan trading.

Deutsche Bank has been appointed by the People's Bank of China as a renminbi clearing bank in Frankfurt, making it the first European bank to receive the designation. The German lender will provide direct end-to-end processing, clearing and settlement services for cross-border renminbi transactions for European companies and financial institutions, aiming to give European businesses more direct access to China's onshore financial system. The move supports China's push to expand use of the yuan in trade and investment, building on Deutsche's participation in China's Cross-Border Interbank Payment System since 2015. The appointment strengthens Deutsche's role as a global clearing partner and adds another piece to China's yuan internationalization puzzle, though the currency still faces challenges in becoming a widely held reserve asset.

Analysts expect the Chinese yuan could strengthen against the US dollar in September, potentially reaching 6.70 to 6.73 per dollar, driven by seasonal factors such as typically stronger exports, the end of the dividend payment season, and a weaker dollar if US inflation data comes in below expectations, reducing the likelihood of further Fed rate hikes. Over the past month, the offshore yuan has moved in a range of just 560 pips, compared with a monthly average of about 845 pips in 2026, reflecting sluggish trading partly due to the People's Bank of China's daily reference rate being weaker than expected for more than four consecutive months, the longest stretch since Bloomberg began compiling data in 2018. Carie Li, a strategist at DBS Bank, estimates the yuan could strengthen to those levels if US inflation is lower than expected, while BNY and Bloomberg Intelligence also see a stronger yuan. Wee Khoon Chong, senior Asia-Pacific market strategist at BNY, notes the dollar-yuan pair is likely to decline on dollar weakness, but the yuan's strength has not yet coincided with a broad-based recovery in China's economy. Stephen Chiu, head of emerging market strategy at Bloomberg Intelligence, sees Chinese export orders likely increasing, especially for electronics, which will support the export sector and the yuan, and expects September could be the point when the yuan starts to move decisively again.

In a five-year plan released on the 10th, the People's Bank of China laid out a policy to keep the renminbi exchange rate basically stable and expand the use of the renminbi in international trade and investment. It also stated that it will resolve risks in key areas, strengthen financial support to boost consumption, and steadily promote high-level opening-up of the financial sector.