Yuan faces stronger depreciation in H2 2021 – China Press
|The Chinese yuan is likely to remain vulnerable to downside pressures in the second half of this year, as the US dollar may rebound on accelerated recovery and tightening of monetary policy, the PBOC-run newspaper Financial News reports, citing analysts.
Key quotes
“The Federal Reserve is expected to release a signal of QE reduction in Q3 amid increased inflation, and China will not follow up any interest rate hikes quickly, possibly leading to further narrowed spread over the two countries' interest rates, or even a reversed spread that may push the dollar stronger.”
“The US and other developed countries are expected to basically achieve herd immunity in Q3, and the growth gap may narrow if the Chinese economy slows down in H2 while the US recovery speeds up.”
Related reads
PBOC issues CNY200 billion via one-year MLF at 2.95%
Fed to keep flexibility on tapering at the meeting – Morgan Stanley
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.