China: Strong current account backs Chinese Yuan appreciation - Standard Chartered
Standard Chartered’s Shuang Ding and Hunter Chan highlight China’s strengthening external position, raising the 2026 and 2027 current account surplus forecasts on larger goods surpluses and smaller services deficits. They argue this strong current account will support further capital account opening, gradual CNY appreciation and expanded authorised channels as China advances its Renminbi…
United Overseas Bank analysts Quek Ser Leang and Lee Sue Ann currently view the USD/CNH pair with a negative bias, anticipating the US Dollar to marginally decrease within a specified range. They observe only slight downside momentum in the short term, which could help contain potential losses. Over the course of 1-3 weeks to months, the analysts project a steady decline of the currency pair towards the level of 6.6640, while maintaining its position below the resistance cloud around 6.7815.
On a 24-hour basis, the team had previously mentioned on Friday that the USD might trade within a range of 6.6700-6.6760. However, the USD has since slipped to a low of 6.6688. As the momentum of the decline is gentle, any further reduction is considered unlikely to reach the 6.6640 mark today. The key resistance level stands at 6.6740.
Over the span of 1-3 weeks, the analysts have maintained their negative stance on the USD, as highlighted in their most recent narrative from October 21, when the spot rate was 6.6750. They reiterated that the USD could experience a gradual decline towards 6.6640. Should the pair breach the 6.6780 level (previously identified as strong resistance at 6.6850), it could indicate further decline of the USD.
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