The People’s Bank of China has been guiding the yuan toward appreciation, fueling market speculation of a strategic pivot toward supporting a firmer currency as domestic economic prospects brighten. n nThis week, the central bank set its daily reference rate for the yuan at the highest level in nearly a year, despite minimal movement in the US dollar. Analysts suggest this move reflects more than mere tolerance for a stronger yuan—it may indicate a deliberate effort to foster a steady and controlled rise in the currency’s value. Such a stance could signal growing confidence in China’s economic recovery and a desire to bolster financial stability through enhanced currency strength.
— news from Bloomberg.com
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China Nudges Yuan to Strengthen as Economic Optimism Grows
China’s central bank is nudging the yuan higher, stoking speculation of a subtle shift in strategy toward favoring a stronger exchange rate as the economic outlook improves. n nThe People’s Bank of China raised its daily reference rate for the yuan by the most in nearly a year this week even as the dollar was largely unchanged. This may signal authorities are not only comfortable with a stronger currency but looking to engineer a gradual appreciation, according to some market watchers.