SHANGHAI: China’s yuan weakened on Thursday against the US dollar, following data that showed persistent weakness in property sector, suggesting an uneven recovery in the world’s second-largest economy.
While October data this week showed the industrial and retail sectors making a comeback, a sharp drop in property investment and weak new home prices pointed to a struggling real estate sector that remains a drag on the economy.
“Optimism for the yuan remains aligned with that of the Chinese economy,” said Philip Wee, senior FX strategist at DBS, adding that recovery hopes were also dampened by negative export and inflation data.
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 7.1724 per US dollar, the firmest level since Sept. 27.
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