CNY: Trade resilience and fix support renminbi – MUFG
|MUFG’s Senior Currency Analyst Lee Hardman highlights that strong Chinese trade data and a firmer PBoC daily fix are supporting the Chinese Yuan. Exports have surprised to the upside despite US tariffs, while reduced tariff risks had encouraged policymakers to allow CNY appreciation versus the US Dollar before the Middle East conflict. However, potential energy price shocks could cap near-term upside for the renminbi.
China data and policy back CNY
"The main economic data release overnight was the latest trade report from China for February."
"The report highlights that China’s trade continues to hold up better than expected to disruption from US tariffs."
"The reduction in tariff risks to trade had been encouraging policymakers in China to allow the renminbi to strengthen more against the US dollar this year prior to the Middle East conflict."
"The risk of an energy price shock for China’s economy is likely to dampen upside momentum in the near-term although the PBoC did set a stronger than expected daily fix overnight at just below the 6.9000-level."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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