Yuan holds steady as investors await Fed minutes, China economic data

SHANGHAI: China’s yuan held largely steady against the US dollar on Tuesday, as investors awaited the minutes of the Federal Reserve’s latest meeting and other fresh domestic economic data.

Prior to market opening, the People’s Bank of China (PBOC) set the yuan’s midpoint rate at 6.8054 per dollar, 216 pips weaker than a Reuters estimate of 6.7838.

In the spot market, the onshore yuan traded at 6.7925 per dollar as of 0346 GMT, nearly unchanged from the previous late-night close of 6.7924.

Its offshore counterpart last fetched 6.7951.

“(The) market is likely to trade sideways at the current levels for the time being,” said a trader at a foreign bank.

Investors were awaiting a string of domestic economic indicators due for release in the coming week, hoping for a clearer picture of the broader economy, currency traders said.

“The theme of June’s economic data is lacking policy stimulus,” ANZ economists said in a note.

“China’s Q2 GDP growth is expected to slow to 4.5% year-on-year from 5.0% in Q1 2026 primarily due to lower fiscal intensity,” they said, noting credit growth was expected to remain slow but they did not expect an interest rate reduction in July.

China is due to report June inflation data on Thursday, followed by second-quarter gross domestic product (GDP) figures and other activity indicators next Wednesday.

The World Bank projected on Tuesday that China’s economic growth would ease to 4.4% in 2026 and to 4.3% in 2027 as the property sector continues to adjust to lower housing demand and consumers remain cautious.

Another market focus is the Fed’s monetary policy trajectory, with investors shifting their attention to the minutes of the Federal Open Market Committee’s (FOMC) June meeting, due on Wednesday, for clues on the US rate outlook.

Separately, Beijing and Hong Kong authorities announced a range of measures on Tuesday to bolster currency, bond and gold trading in Hong Kong, stepping up efforts to establish the city as a leading offshore yuan centre amid heightened geopolitical tensions.