CNY FX Rate Trends and Analysis

The CNY FX rate has been on a wild ride in recent years. The exchange rate has fluctuated significantly, with the yuan trading at around 6.9 against the US dollar in 2020.

One of the main drivers of the CNY FX rate is the trade deficit between China and the US. According to the article, the trade deficit has been a major concern for the Chinese government, leading to interventions in the FX market to stabilize the yuan.

The PBOC has been actively managing the CNY FX rate to prevent sharp depreciations. In 2015, the PBOC devalued the yuan by 1.9% in a single day, a move that sent shockwaves through global markets.

The CNY FX rate has also been affected by China's economic growth. As the country's economy has slowed down, the yuan has depreciated against the US dollar.

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The Chinese yuan has experienced a controlled depreciation against the US dollar from 2013 to 2022, with the People's Bank of China containing its movements to maintain economic stability.

The exchange rate ended 2022 at CNY 6.90 per USD, a significant increase from the end-2021 value of CNY 6.35 per USD.

You can view exchange rate information for specific years by visiting our dedicated page for more details.

Here's a list of available years for exchange rate information:

To get a visual representation of the exchange rate, check out our China Exchange Rate Chart, which displays the rate from 2018 to 2024.

The CNY/USD rate is down -0.45% in the six months, indicating a decrease in the value of the Chinese yuan compared to the US dollar.

The CNY to USD exchange rate has been fluctuating, and it's essential to understand the current trend. The CNY/USD rate is down -0.45% in the six months, indicating a decrease in value compared to the US Dollar.

This decline in value may be attributed to various market factors, but it's crucial to track the fluctuations to make informed decisions. The CNY has decreased in value compared to the US Dollar over the past six months.

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The Chinese Yuan Renminbi has seen some fluctuations in its value against the US Dollar in recent years. In the last six months, the CNY/USD rate has decreased by 0.45%.

From 2013 to 2022, the Chinese yuan experienced a gradual but controlled depreciation against the US dollar. This means the yuan's value went down over time.

The People's Bank of China played a key role in keeping the yuan's movements contained, reflecting the government's focus on maintaining economic stability. This was especially important during a time of trade tensions and economic slowdown.

The exchange rate ended 2022 at CNY 6.90 per USD, which is a higher value than the end-2021 rate of CNY 6.35 per USD.

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The factors affecting the CNY to USD exchange rate are complex and multifaceted. Economic indicators, such as GDP growth, inflation, and interest rates, can significantly impact the exchange rate.

Geopolitical events, like elections and trade agreements, can also influence the exchange rate. Central bank decisions, including interest rate changes, can affect the exchange rate.

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Domestic challenges in China, such as weak growth, can lead to more PBOC easing, which can put downward pressure on the yuan. Capital outflow pressure remains a concern due to low interest rates and limited risk appetite for domestic assets.

The CNH and CNY pairs typically track closely, but the CNH can move more significantly when there's momentum. Historically, offshore investors have looked for more yuan depreciation, causing the USDCNH pair to trade higher than the USDCNY pair.

However, in recent weeks, momentum has shifted, with the USDCNH trading at a lower level than the USDCNY pair on multiple days. This reflects offshore investors positioning for a yuan recovery.

The People's Bank of China uses a counter-cyclical factor to maintain the yuan's relative stability. This tool has been significant since July 2023, but has fallen to nearly zero as depreciation pressure faded in August.

A stronger CNY can be beneficial for China, and policymakers are seeking research on its impact. The yield spread between Chinese and US bonds has narrowed, with the 2-year US-China yield spread currently at 2.4pp, down from its peak of 3.18pp in April.

Here are some key factors affecting the CNY to USD exchange rate:

The CNY FX rate has been on a rollercoaster ride in recent years, influenced by various market trends.

The Chinese economy's rapid growth has led to a significant increase in demand for foreign exchange, causing the CNY to appreciate against the USD.

The People's Bank of China (PBOC) has been actively intervening in the foreign exchange market to manage the CNY's value, which has resulted in a volatile trading environment.

The CNY's trading range has been relatively narrow, typically fluctuating between 6.5 and 7.0 against the USD.

The PBOC's efforts to manage the CNY's value have had a ripple effect on other Asian currencies, leading to a synchronized appreciation of the region's currencies.

The CNY's value is also influenced by China's trade balance, which has been in surplus in recent years, contributing to the currency's appreciation.

The CNY's appreciation has had a positive impact on Chinese exports, making them more competitive in the global market.

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We generally expect the CNY to move stronger due to external developments outweighing domestic drags.

The CNY is expected to remain a low-volatility currency relative to other Asian FX.

A more CNY-favourable yield spread is anticipated in the coming months, which should support the currency's appreciation.

However, the US elections represent a wildcard to the CNY, with a potential Harris administration's policies toward China potentially leading to further CNY upside.

A Trump victory is generally seen as dollar-positive, which could add an extra country-specific downside risk for the CNY.

Our baseline scenario has the USDCNY ending the year around 7.10, with a medium-term fluctuation range between 7.00-7.30.

The global ING interest rate scenario is expected to favour the CNY appreciating over a 1-2 year horizon.

We forecast the USDCNY to move stronger toward 7.00 by the end of 2025.

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