China's yuan rebounds as PBOC lifts midpoint, dollar falls after Democrats take Congress
HONG KONG: China’s yuan bounced from a more than a two-week low against the dollar on Thursday, as the central bank lifted its midpoint rate and the greenback weakened as Democrats captured control of Congress in US midterm elections. The currency had come under pressure earlier this week after China’s move to raise the foreign-exchange reserve requirement ratio (RRR) tempered the yuan’s rally.…
Hong Kong: China's yuan made a rebound on Thursday, rising from a two-week low against the dollar, as the central bank lifted its midpoint rate and the greenback weakened following Democrats' victory in the US midterm elections. The currency had faced pressure earlier in the week due to China's move to raise the foreign-exchange reserve requirement ratio (RRR), which dampened the yuan's rally.
The spot yuan rose 0.09% to 6.6698 against the dollar by 0318 GMT, after trading between 6.6680 and 6.6727. The People's Bank of China raised the midpoint rate to 6.7156 per dollar, a notable 373 pips below a Reuters' estimate. The fixed midpoint allows the spot yuan to trade within a 2% range daily. The weakening dollar, due to Democrats' sweeping win in US midterm elections, eliminating a major source of political uncertainty, further bolstered Asian currencies, including the yuan.
Citic Securities noted that the trend of yuan appreciation remains, albeit with a moderated pace. The yuan has declined 0.2% against the dollar this month but gained 4.9% so far in 2020. The offshore yuan traded at 6.6675 per dollar, up around 0.11% in Asian trade. The dollar's six-currency index fell 0.207% to 101.26.
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