Yuan edges up as concerns US will brand China a ‘currency manipulator’ subside

PUBLISHED : Wednesday, 12 April, 2017, 3:34pm
UPDATED : Wednesday, 12 April, 2017, 3:34pm

The yuan traded slightly stronger on Wednesday afternoon as concerns that the US might brand China a currency manipulator subsided.

Offshore yuan in Hong Kong traded at 6.8983 to the US dollar as of 2.30pm, 0.03 per cent or 19 points stronger than on Tuesday. Onshore yuan in Shanghai weakened to 6.8940 versus the greenback, 0.08 per cent or 52 points weaker than on Tuesday when it gained 0.14 per cent.

The People’s Bank of China on Wednesday set the yuan reference point against the dollar at 6.8940, 17 basis points or 0.024 per cent stronger than the previous day.

Traders are allowed to trade up to 2 per cent either side of the reference point for the day.

A top outside adviser to President Donald Trump said the US probably won’t label China a currency manipulator in a report due this month, according to Bloomberg.

“I would doubt that would happen,” Stephen Schwarzman, chairman of Blackstone Group, told Bloomberg, when asked about China being designated as such in the Treasury Department’s next foreign-exchange report.

“The Chinese yuan should stabilise in April as concerns about a trade war between the US and China subside, and because the possibility of the US tagging China as a currency manipulator is now small,” said Guo Jiayi, an analyst at CIB Research. “Plus, the US dollar has no reason to experience upward momentum.”

Japanese yen strengthened for a third straight day, up 0.08 per cent to 109.54 per dollar. The British pound fell, trading at US$1.2483 on Wednesday afternoon while the euro strengthened 0.12 per cent to US$1.0614.