SHANGHAI: China’s yuan held steady against the dollar on Friday, but is headed for its fourth weekly decline amid a resurgence in the US currency and growing concerns over an escalating trade war if Donald Trump wins next month’s election.
The yuan was trading around 7.1250 per dollar in late morning session, 0.1% weaker than the previous close. For the week, it is set to decline 0.3%.
The dollar index is little changed after overnight weakness, as the greenback takes a breather after jumping more than 3% so far this month.
“The fast-approaching US election suggests that the US dollar should stay robust even if its momentum has been blunted for now,” Alvin Tan, strategist at RBC Capital Markets said in a note to clients.
The recent yuan guidance rate set by the People’s Bank of China indicates “no PBOC pushback from the recent USD resurgence,” Tan said.
The PBOC on Friday set the midpoint rate at 7.1090 per dollar, in line with market expectations.
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