HONG KONG: China’s yuan eased from a two-week high against the US dollar on Monday as the greenback firmed following a flare-up in Gulf tensions, although a firm midpoint fixing continued to anchor the Chinese currency.
The yuan was last trading 0.07 percent lower at 6.7819 per dollar, pulling back from a two-week high of 6.77 reached on Friday.
Its offshore counterpart traded at 6.7855 yuan per dollar, down about 0.05 percent in Asian trade.
The US dollar rose against most of its peers on Monday, as rising oil prices saw Federal Reserve rate-hike bets creep back up. US and Iranian forces exchanged heavy fire over the weekend, and Tehran said it had again closed the Strait of Hormuz.
The bank remains constructive on the yuan for the medium term, but prefers shorting the euro or Singapore dollar against the offshore yuan to express that view, the analysts said.
Prior to the market opening, the People’s Bank of China set the midpoint rate at 6.7972 per dollar, its strongest since February 10, 2023, although that was 122 pips weaker than a Reuters estimate. The spot yuan is allowed to trade 2 percent either side of the fixed midpoint each day.
Comments