USD/CNY: Yuan breaches 6.7 for the first time in nearly a year

  • CNY sold-off into US-Sino trade war fears.
  • Yuan sell-off stalls as the Chinese state-owned banks intervene.

The Yuan extends its downward spiral and broke the key 6.70 support area versus its American rival for the first time since September 2017, now recovering some ground to trade near 6.6950 levels.

The latest recovery attempt in the Yuan can be attributed to the Reuters report that major state-owned Chinese banks are seen swapping Yuan for US dollars in forwards and immediately selling them into the spot market, which in turn offers the much-needed respite to the Yuan.

The ongoing weakness in the Yuan is mainly driven by jittery Chinese stock markets amid US-Sino trade war fears, as caution prevails ahead of the July 6 deadline for the US tariffs on $34 billion worth of Chinese goods. China is also expected to retaliate with tariffs on the US goods.

Meanwhile, the PBOC set Yuan mid-point at the lowest level since Aug. 25, 2017, at 6.6497 today.

Also Read: USD/CNH: Offshore Yuan hits the lowest level since August 2017

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.