China’s yuan rose to a three-year high, with the onshore rate at 6.8287 per
dollar and the offshore rate at 6.8268, as a US-Iran ceasefire improved risk
sentiment and pressured the dollar. The People’s Bank of China set a stronger
daily fixing at 6.8680, the firmest since April 2023, though still weaker than
market estimates, signaling a preference for gradual appreciation. The PBOC has
consistently bolstered the currency through firm daily fixings amid war-induced
market turmoil, a move designed to anchor investor confidence in Chinese assets.
The yuan has gained about 2.2% this year, outperforming regional peers,
supported by China’s resilience to energy shocks, strong commodity reserves and
expectations that higher oil prices could help ease producer price deflation.
