Chinese policymakers appear comfortable with a stronger yuan
MUFG's Lee Hardman says Chinese officials appear comfortable with yuan gains as trade risks from President Trump's tariffs have eased.
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what happened
The renminbi’s recent appreciation suggests that Chinese policymakers remain willing to tolerate further currency gains, Lee Hardman of MUFG Bank said in a note cited by Dow Jones Newswires. In his view, trade risks linked to President Trump’s tariffs have eased.
Hardman said the currency’s upward momentum has been supported by the People’s Bank of China setting lower daily reference rates for dollar-yuan over the past month, even as the dollar index has risen by around 4%. He expects policymakers to keep allowing a gradual renminbi advance to contain the effect on trade relations, amid the European Union’s objections to China’s widening trade surplus with Europe.
The dollar was flat at 6.6925 yuan, according to LSEG, after earlier touching 6.6913, its lowest level in 45 months.
why it matters
The central bank’s daily fixing remains a key signal for currency markets because it indicates how much appreciation officials may accept. A stronger renminbi could also affect China’s trade relations as the EU challenges the country’s expanding surplus with Europe.
instruments
sources
- Chinese Policymakers Appear at Ease With Stronger Yuan — Market Talk — Dow Jones Newswires, 12 October 2026 at 11:43 UTC
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