Chinese Yuan: Gradual appreciation bias with key levels against US Dollar – OCBC

FXStreet Insights Team FXStreet

OCBC’s Sim Moh Siong and Christopher Wong highlight that RMB and CNH remain supported by softer USD dynamics and exporter conversion, but the People’s Bank of China is signalling a preference for gradual gains via its fixing. USD/CNH trades with mild bearish momentum and oversold RSI, with downside bias tempered by the risk of a snapback around clearly defined support and resistance levels.

USDCNH downside skew but measured

"RMB ended the week near multi-year highs, but the fixing continues to signal some resistance to the pace of appreciation."

"Friday’s USDCNY midpoint was nudged slightly higher to 6.7817 and remained around 550 pips above market expectations, suggesting the PBoC remains comfortable with gradual RMB strength but is leaning against an overly rapid or one-way move."

"Softer USD dynamics and exporter conversions should remain supportive, though the fixing behaviour reinforces our view that any further appreciation is likely to remain gradual."

"USD/CNH last closed at 6.7210 levels. Daily momentum is mild bearish while RSI fell into oversold conditions. Bias remains skewed to the downside though risk of snapback not ruled out."

"Resistance at 6.7480 (21 DMA), 6.7540. Support here at 6.72, 6.7140 (61.8% fibo retracement of 2022 low to triple-top) and 6.70 levels."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD remains offered; bears target 1.3600

GBP/USD now leaves behind part of its recent recovery and revisits the low 1.3600s at the beginning of the week. Indeed, Cable trades with a mild downward bias amid decent gains in the Greenback as investors remain wary of upcoming US data releases and the Jackson Hole event.

EUR/USD remains sidelined above 1.1650

EUR/USD trades on the defensive following the closing bell on Wall Street on Monday, hovering around the 1.1660 region and adding to Friday’s small decline. The pair’s pullback comes in response to an acceptable rebound in the US Dollar in a context of generalised caution ahead of key US data releases and Chair Warsh’s speech in Jackson Hole.

Gold poised to extend its bullish run

Gold surrenders part of its initial advance, although it keeps its bullish pace well and sound above the $4,600 mark per troy ounce on Monday. The precious metal’s move higher comes despite slight gains in the US Dollar and a modest pullback in US Treasury yields across the curve.

XRP surged 72%, but is the rally really about XRP?

Ripple (XRP) surged more than 72% in less than a week, its strongest rally since July 2025, as cryptocurrency prices broadly broke out. But the move has a problem: it may have little to do with XRP itself. The token's near-term rally appears to have been driven largely by a broader liquidity shift after the US Treasury expanded long-end bond buybacks, pulling yields lower and lifting risk assets.

Convulsion in credit markets

The United States government just posted a $432.3 billion deficit for July, the largest monthly shortfall since March of 2021. That single burst of red ink pushed the yeartodate deficit to $1.8 trillion, with two months still remaining in fiscal 2026. At this pace, Washington will soon wax nostalgic for the “good old days” when annual deficits were only $2 trillion.

$20 billion offered, $2 billion taken: Why Treasury doubled its buyback cap

The US Treasury moved off its own calendar on Wednesday, and that is the part worth sitting with. At 12:32 GMT, the department said it would at least double the size of liquidity support buyback operations in the 10-year to 20-year and 20-year to 30-year sectors, lifting the maximum from $2 billion per operation to at least $4 billion, effective September 9 and running to November 4.