Yuan Maintains Stability Against US Dollar Amid Trade Optimism

HONG KONG: On Wednesday, the Chinese yuan exhibited resilience against the US dollar, bolstered by regulatory assurances aimed at preserving market equilibrium and renewed optimism surrounding trade relations between the US and China.

Market sentiment was lifted following remarks by US Treasury Secretary, who alluded to a potential de-escalation in the US-China trade dispute. He also mentioned that while negotiations with Beijing are yet to commence, they are expected to be arduous.

Furthermore, the State Administration of Foreign Exchange conveyed on Tuesday its commitment to preventing excessive fluctuations in exchange rates and safeguarding against unusual cross-border capital movements.

The regulatory body also stated that it would enhance oversight and expand its policy instruments, while rectifying any pro-cyclical market tendencies, seemingly referencing measures to avert erratic currency fluctuations.

By 0420 GMT, the yuan had appreciated by 0.09%, reaching 7.2995 against the dollar, marking a gain of 65 pips compared to the previous session’s close.

In offshore trading, the yuan was valued at 7.3077 per dollar, reflecting a marginal increase of less than 0.1% during Asian trading hours.