Latest news with #CNHHIBOR
Business Recorder
03-07-2025
- Business
- Business Recorder
China's yuan slips as investors evaluate US trade negotiations with other countries
SHANGHAI: China's yuan slipped against the dollar on Thursday, as market participants closely monitored trade negotiations between the United States and other countries on what they might mean for the world's second-largest economy. US President Donald Trump said on Wednesday that the United States had struck a trade deal with Vietnam, with the 90-day pause on duties on imports from dozens of countries set to expire on July 9. China and the US reached a trade framework to ease escalating tariffs in June following a phone call between Trump and Chinese President Xi Jinping. 'While the US-China agreement marks a significant de-escalation with both nations previously imposing sweeping tariffs and non-tariff barriers, we should not forget that the effective tariff rate for goods entering the US from China still stands at 55%,' Inga Fechner, senior economist for global trade at ING, said in a note. 'Additionally, several anti-dumping countermeasures are in place. Tensions remain high as China voices strong discontent over other countries entering trade agreements with the US, which it considers to be undermining its interests.' As of 0316 GMT, the onshore yuan was 0.03% lower at 7.1643 per dollar, while its offshore counterpart traded at 7.1611. Some currency traders pointed out that loose yuan liquidity conditions in both onshore and offshore markets also weighed on the Chinese currency. The CNH Hong Kong Interbank Offered Rate benchmark (CNH HIBOR), a gauge that measures the yuan's cost of borrowing in the financial hub, fell across the board on Thursday. Its one-year tenor hit the lowest level on record. The volume-weighted average rate of the benchmark overnight and seven-day repo traded in the onshore interbank market, fell to levels last seen in 2023. Yuan near 8-month high Despite the slight weakness on Thursday, the yuan has strengthened about 1.5% against the US dollar since April, when Trump rolled out his so-called reciprocal tariffs, compared with sharp rallies seen in other emerging market currencies. 'There is a delicate balance that yuan stability is achieving - an environment that is positive for foreign investors, predictable for importers and exporters and it provides little room for yuan speculation,' Maybank analysts said in a note. Prior to the market opening, the People's Bank of China (PBOC) set the midpoint rate at 7.1523 per dollar, its strongest since November 8, 2024, and 95 pips firmer than a Reuters' estimate of 7.1618. The spot yuan is allowed to trade 2% either side of the fixed midpoint each day.
Business Recorder
09-05-2025
- Business
- Business Recorder
China's yuan slips as investors wary ahead of Sino-US trade talks
SHANGHAI: China's yuan slipped against the dollar on Friday, as investors cautiously looked towards key tariff talks with the United States over the weekend for signs of a de-escalation of the trade dispute between the world's two largest economies. Officials from Beijing and Washington prepare to meet in Switzerland on Saturday for negotiations that markets hope could be the first step toward resolving the trade war disrupting the global economy. 'The talk is likely to centre on de-escalation rather than a big trade deal, with Bessent stating that current tariff rates aren't sustainable and are equivalent to a trade embargo,' said Ju Wang, head of Greater China FX & rates strategy at BNP Paribas, referring to US Treasury Secretary Scott Bessent. 'The key question for the market is whether tariffs will eventually be reduced to 50–60% or 20–30%. In our base case, where US tariffs on China are scaled back to 50%, the yuan is likely to remain around the current level.' As of 0330 GMT, the onshore yuan was 0.06% lower at 7.2492 per dollar, while its offshore counterpart was down 0.08% at 7.2492. Prior to the market opening, the People's Bank of China (PBOC) set the midpoint rate, around which the yuan is allowed to trade in a 2% band, at 7.2095 per dollar, its weakest since April 24. China's yuan slips as PBOC guides currency lower The much weakened official guidance fixing followed a broad rebound in the dollar. Some currency traders say Chinese authorities using the guidance fix as a means of maintaining yuan stability in the face of intensifying trade tension with the United States. Sources told Reuters that China's central bank has approved foreign exchange purchases by some commercial banks to pay for gold imports under recently increased quotas. Offshore yuan liquidity conditions in Hong Kong loosened to effectively lower the cost of shorting yuan, traders said. The one-year tenor of CNH Hong Kong Interbank Offered Rate benchmark (CNH HIBOR), set by the city's Treasury Markets Association (TMA), was set at 1.97242% on Friday, the lowest level since data was available. Separately, markets barely reacted to China's April trade data, which showed exports rose faster than expected, while imports narrowed their declines, giving Beijing some relief ahead of the talks with the US this weekend.
Emirates 24/7
24-02-2025
- Business
- Emirates 24/7
China's Yuan Hits Three-Month Highs Amid Dollar Weakness and Stock Market Gains
China's yuan strengthened to fresh three-month highs against the U.S. dollar on Monday, driven by strong domestic equity market performance and broader dollar weakness. Policymakers are expected to prioritize currency stability ahead of next week's National People's Congress (NPC) meeting, analysts at Barclays noted. They added that inflation targets and fiscal support measures will be key topics to watch. By midday, the onshore yuan rose 0.3% to 7.2313 per dollar, its highest level since November 29, 2024. Meanwhile, the offshore yuan gained 0.36% in Asian trade, reaching 7.2304 per dollar. The Chinese currency has now strengthened for four consecutive days, supported by an AI-driven rebound in domestic stock markets and the recent decline in the greenback. This momentum has helped the yuan gain 0.3% against the dollar this month and 0.9% year-to-date, recovering from multi-year lows of 7.33 in January. Before the market opened, the People's Bank of China set the midpoint rate at 7.1717 per dollar. Since mid-November, the central bank has consistently set its official guidance stronger than market expectations, a move analysts interpret as an effort to curb the yuan's depreciation. In the bond market, Chinese 10-year government bond yields rose 3.6 basis points to 1.78%, while the yield on comparable U.S. Treasury bonds fell to 4.4%. The U.S. dollar index, which measures the greenback against a basket of six major currencies, declined 0.3% to 106.16—its lowest level since December—following a Wall Street sell-off and weaker economic data. Key Onshore vs. Offshore Levels: Overnight dollar/yuan swap: Onshore -8.70 pips | Offshore -8.70 pips. Three-month SHIBOR: 1.8% | Three-month CNH HIBOR: 2.5% Instrument Current % Change Day's High Day's Low Previous Close YTD Change (%) Spot yuan 7.2313 +0.3% 7.2278 7.2517 7.2313 +0.9% Offshore yuan 7.2304 +0.36% 7.2264 7.2542 7.2304 +1.46% Follow Emirates 24|7 on Google News.
