SHANGHAI: China’s yuan remained largely steady against the US dollar on Monday after a private sector survey showed China’s manufacturing activity grew at the fastest pace in more than three years.

The Chinese currency also stabilised due to a weakened US dollar after data showed inflation in the world’s largest economy subsided last month, cementing expectations the Federal Reserve will start cutting interest rates this year.

By 0312 GMT, the yuan was 0.01% lower at 7.2678 to the dollar after trading in a range of 7.2665 to 7.2685.

However, the yuan still hovered around seven-month lows and was down 2.3% for this year.

It has been under pressure since early 2023 as a prolonged property crisis, anaemic consumption and falling yields drive capital flows out of China, and foreign investors stay away from its struggling stock market.

Prior to the market opening, the People’s Bank of China set the midpoint rate, around which the yuan is allowed to trade in a 2% band, at 7.1265 per dollar, 1,293 pips firmer than a Reuters’ estimate.