China’s yuan down almost 4 per cent against US dollar in April as market guards against economic headwinds
- Depreciation pressure on the yuan against the US dollar has intensified over the past two weeks amid more lockdowns across China
- The onshore yuan closed at 6.5866 per US dollar on Friday from the previous night close of 6.6255, having weakened to 6.6520 earlier in the day
China’s yuan has lost 3.8 per cent against the US dollar this month as pressure mounts on the world’s second largest economy which has been battling with the worst coronavirus crisis in over two years.
Depreciation pressure on the yuan against the US dollar has intensified over the past two weeks amid more lockdowns across China.
The financial hub Shanghai has been in lockdown for nearly a month with no sign of it easing any time soon, and as the outbreaks continue to spread, the capital city of Beijing has now rolled out restrictions.
“The bad news is that the lockdown is likely to persist in Shanghai and some other regions as the local cases are still far from being contained from the authorities’ perspective,” said Commerbank on Friday.
“In the foreign exchange space, the Chinese currency lost about 1 per cent on Thursday versus the US dollar, and the market has gradually priced in more weakness given the headwinds facing the economy.”