CNY: Supported by exports and geopolitics – Commerzbank

Commerzbank’s FX team highlights that CNY is the only Asian currency stronger against the Dollar since late February, helped by robust exports and policy support. They see China tactically tolerating a firmer CNY ahead of the Trump–Xi summit and using it to bolster its image as a stabilizing force while steadily increasing CNY’s role in global trade settlement.

China currency gains on policy support

"All Asian currencies have depreciated against the USD since the end of February except for CNY. They are down on average by 2.2% vs USD while CNY is up 0.5%. Year-to-date (YTD), Asian currencies are down by around 1.1% and the top three performers are MYR (+2.6%), CNY (+2.3%), and SGD (+0.8%)."

"CNY is up 2.3% YTD. Structural headwinds such as overcapacity, ongoing property downturn, and fragile domestic sentiment persist. However, surprisingly robust export performance has provided a fundamental cushion for the CNY. Additionally, other factors are also supporting the currency, including:"

"Geopolitical Signaling: Strength may be a tactical move ahead of the Trump-Xi Summit, which is re-scheduled for 14-15 May. China appears to be tolerating a stronger CNY to distract attention from the large current account surplus, evidenced by the PBoC's consistently stronger mid-point fixing for CNY in the first 11 weeks of this year. Furthermore, China is attempting to position itself as a stable force amid the ongoing Middle East conflict."

"Increased Settlement Share: Confidence is growing as more trade is settled in CNY. The latest global payment data from SWIFT noted that yuan’s share in global payments rose to 3.1% in March 2026 vs 2.7% at the end of 2025. While still trailing the USD (51.1%) and EUR (21.3%), SWIFT only captures part of the picture."

"According to the PBoC, about one-third of China’s global merchandise trade goods was settled in CNY in 2025, up from 20% in 2022. Notably, nearly all of China-Russia trade is settled in CNY, and (contributed about 3-5pp to the trade settled in CNY). CNY's share of China's total cross-border settlements (covering trade, services and financial transactions) reached around 53% in March 2026;"

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