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Researchers at UOB Group noted the Chinese Yuan could keep grinding lower to the 7.0 area vs. the greenback.

Key Quotes

“In the past week, Chinese authorities has announced various measures to support economic growth amid the ongoing trade spat with the U.S and deleveraging of its financial system”.

“The measures range from easing of credit conditions (18-Jul), a softer-than-expected stance towards wealth management products (20-Jul), a record injection of longer-term funding available to commercial lenders and fiscal stimulus (23-Jul, see report here)”.

“These measures add to signs that the PBoC is adopting a more accommodative stance, even though it has not announced any official shift from its “prudent and neutral” policy”.

“Overall, looser monetary conditions are likely to bias towards a weaker CNY. As such, we forecast USD/CNY rising further to 6.95 by end of this year and 7.10 by mid-2019″.