At the beginning of the trading week, the yuan rose amid the dollar’s decline against major currencies. The weakening of the greenback was due to President Trump’s failure to repeal and replace Obamacare. This sparked concerns over his ability to push through planned fiscal policy changes.
The central parity rate of the renminbi strengthened by 144 basis points to 6.8701 against the US dollar, according to the China Foreign Exchange Trade System. This is the highest level since February 24.
In the spot foreign exchange market, the yuan traded at 6.8773 against the dollar in early trading and at 6.8735 in the middle of the day. Compared with the previous closing price, the yuan strengthened by over 100 points.
Meanwhile, the dollar index, which measures the value of the United States dollar relative to a basket of foreign currencies, fell to 99.285 in the middle of the day, its lowest level since February 2.
Over the past two weeks, confidence in most of the Asian currencies has improved after the recent commentary from the Federal Reserve indicated a less hawkish stance than had been expected.
