Yuan holds ground on trade optimism, regulator vows stability

HONG KONG: China’s yuan held steady against the US dollar on Wednesday, supported by regulatory pledges to maintain market stability and fresh optimism over US-China trade relations.

Sentiment improved after US Treasury Secretary Scott Bessent suggested a possible de-escalation of the US-Sino trade war, while noting negotiations with Beijing have not yet started and would be a “slog”.

In addition, the State Administration of Foreign Exchange said on Tuesday that it would prevent excessive exchange rate fluctuations and guard against unusual cross-border money flows.

Regulators will also strengthen oversight and enrich their policy toolkits while correcting any pro-cyclical market behaviour, it added, apparently referencing options to prevent volatile currency moves.

The yuan was 0.09% higher at 7.2995 to the dollar by 0420 GMT, 65 pips firmer than the previous late session close.

Its offshore counterpart traded at 7.3077 yuan per dollar , up less than 0.1% in Asian trade.