BAML lowers USD/CNY 2018 forecast

Joshua Gibson FXStreet

Bank of America-Merrill Lynch (BAML) lowered their 2018 forecasts for the Chinese Yuan in a research note. Despite the lower revision, BAML's projections are still higher compared to other forecasts, calling for 6.4000 by the end of 2018's fourth quarter.

Key highlights:

FX selling by Chinese exporters, foreign portfolio investment into Chinese government bonds and equities driving Yuan lower.
BAML's 2018 Q1 forecast also lowered from 6.9500 to 6.5000.
Yuan expected to weaken further on deteriorating Chinese growth and inflation, as well as policy makers allowing more capital to flow out of China.
BAML expects the Chinese economy to grow by 6.8% in 2018, versus 2017's 6.9%.

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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