The Chinese currency manages to stumble upon the gaining strength the dollar has prior to the BOJ and ECP policy calls. The greenback manages to set a strong footing this Wednesday after consecutive days of bearish trading and hovering over the ten-month low; on the other hand, the yuan fell before reaching the speculated nine-month high.
Yuan Falls, Close to 9-Month High
Yuan fell by 0.11% in earlier trading in Shanghai to $6.7550, although it manages to shrug off some of the losses before the market closes. The Chinese currency was gaining a good 0.9% in its last seven sessions, it was nothing short of remarkable, and it led to analysts to speculate that it might hit the nine-month high before dipping against the dollar today.
Yesterday’s trading for the yuan was hitting the higher levels that were last felt last October of last year; the surge was heavily backed up by the dovish outlook of the Federal Reserve which dragged the dollar on bearish territory for consecutive days. The Chinese economy also manages to grow on an abrupt note that manages to help its currency rally.
According to Bank of East Asia Ltd.’s Kenix Lai, “The yuan is dropping because of profit-taking, and this doesn’t mean the currency’s appreciation path in the medium term is reversed," and "The yuan will likely test 6.7 per dollar in the second half of this year, as the dollar is set to weaken more and China’s economy keeps improving."
USD Rallies After
The greenback manages to claw back into the competition after several bearish trading sessions; the dollar index was trading at the 94.75 levels, inches higher versus its previous price of 94.11. According to the European head of MUFG, Derek Halpenney, “The shifting global central bank monetary policy landscape continues to be an important driver of the FX moves as we slowly enter the quiet summer trading period that often can out-sized market moves.”
Asian Stocks Up
A handful of Asian stocks were rising on today’s market, Hong Kong’s Hang Seng index is up by a 0.5%, hitting its eight-consecutive day of increases; China’s Shanghai Composite was also up by an impressive flat 1%. On the other hand, the Japan’s Topix was also up by 0.1% due to the majority of staple stocks rallying; the Australian stock, S&P/ASX 200 was also caught on the stream with a 0.8% of
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