China's yuan hits 4-year high versus dollar after Fed decision
SHANGHAI: China’s yuan hit a four-year high against the dollar and its major trading partners on Thursday after the Federal Reserve kept rates unchanged, with China’s central bank continuing to guide an orderly appreciation of the currency. The Fed held interest rates steady, as expected, opting to delay any changes to borrowing costs until after next week’s US midterm elections while it awaits…
Shanghai witnessed China's yuan reaching a four-year peak against the US dollar on Thursday, following the Federal Reserve's decision to maintain interest rates unchanged. The People's Bank of China (PBOC) announced a midpoint rate of 6.7147 yuan per dollar, marking its strongest level since February 2023. This move came after the central bank signaled an orderly appreciation of the currency.
The PBOC allowed the yuan to trade within a 2% range of the midpoint rate throughout the day, significantly deviating from market estimates. The central bank's gradual strengthening of the currency, albeit at a slower pace than anticipated, aimed to control the decline in the USD/CNY exchange rate, according to Maybank analysts.
The spot yuan's highest level of the day was 6.6620 per dollar, surpassing the June 2022 record of 6.6596. The trade-weighted value of the yuan against major trading partners rose to 103.75, the highest since July 2022, indicating a 5.9% gain so far this year. Traders now anticipate the European Central Bank's policy decision later in the day, despite expectations of unchanged rates.
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Also reported by 2 other outlets
- China stocks slip as tech weakness overshadows Fed rate decision brecorder.com
- Dollar holds steady ahead of Fed rate decision channelnewsasia.com
