China’s commercial banks bought a net 173.7 billion yuan ($27.2 billion) of the local currency for clients in September, suggesting mainland individuals and corporates prefer to hold the yuan over foreign exchange.Ī Bloomberg index tracking the yuan’s move versus 24 peers has advanced to the highest since 2016, reflecting the Chinese currency’s resilience against a stronger dollar. Shipments soared to a new monthly record in September on strong demand ahead of year-end holidays. Here are four charts to illustrate why the yuan is more likely than not to extend its rise:Ĭhina’s exports have remained robust even as other indicators point to a moderation in growth for the world’s second-largest economy. However, it also risks undermining the competitiveness of China’s exports in the long run. Overall, a stronger yuan is likely to spur more inflows and further boost demand for the currency, which would support Beijing’s push to promote its use globally. But China’s state media has sought to temper the optimism, noting on Wednesday that the currency’s recent rally is unlikely to alter the trend of its two-way movements. says the yuan may rise to 6.15 in a year if there’s a “meaningful” easing in US trade frictions and a clearer move lower in the dollar. The currency could climb to 6.20 per dollar, a level it last reached before it was devalued in 2015, if there’s further progress in US-China talks, he added. “China’s export boom will continue into the first quarter of 2022, sustaining the nation’s large trade surplus,” said Scotiabank foreign-exchange strategist Qi Gao.

Neon signs fallout 4