Related News
Yuan at strongest against dollar in over 14 months
The yuan closed at the strongest level against the US dollar in over 14 months yesterday, capping the largest monthly gain in more than a decade, after the central bank strengthened the official reference rate for the fourth straight day.
But economists who attributed the stronger yuan to a weak US dollar and China's economic momentum, said the fast appreciation may not last in the near term.
The yuan closed at 6.5969 per US dollar in Shanghai yesterday, slightly weaker than Wednesday’s close of 6.5927.
But the closing figure was stronger than the central parity rate of 6.6010 set by the People’s Bank of China, and it was strongest level since June last year.
The yuan can trade between two percent on either side of the central parity rate, which was set before the market opened.
Since the beginning of the month, the yuan has climbed 2 percent against the greenback, recording the largest monthly gain since July 2005.
Economists, however, cautioned that the yuan’s quick rise may not last in the near term.
Jing Ulrich, managing director and vice chairman of J.P. Morgan Asia Pacific, said the yuan is likely to be stabilized in the coming months and will stay below 7 per US dollar within the next 12 months.
She attributed the recent appreciation to the weakening US dollar especially against the euro, improved profitability at Chinese companies along with domestic economic growth, the PBOC’s effective measures to curb capital outflow, and overall strengthening of emerging market currencies.
“The yuan at the current level has greatly boosted foreign investors’ confidence in yuan-denominated assets,” said Ulrich. “So far the currency is not too strong to hurt China’s economy as the country has built strong competitiveness in manufacturing high technology products.”
She added the US dollar may bottom out in the fourth quarter and it’s uncertain if the yuan will continue to appreciate at the current speed.
The official Purchasing Managers’ Index, which measures vitality in manufacturing, rose to 51.7 in August from July’s 51.4, according to data.
- About Us
- |
- Terms of Use
- |
- RSS
- |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证:沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证:31120180004
- |
- 网络视听许可证:0909346
- |
- 广播电视节目制作许可证:沪字第354号
- |
- 增值电信业务经营许可证:沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.