FX.co ★ Offshore Yuan Edges Higher

The offshore yuan edged slightly higher to approximately 7.18 per dollar on Friday as investors absorbed the latest policy move by the People's Bank of China. As anticipated, the central bank maintained its key lending rates at their historically low levels in its June rate-setting meeting. The one-year loan prime rate was kept at 3.0%, and the five-year LPR remained at 3.5%, following last month's 10 basis point rate cut and reductions in deposit rates by major state-owned banks. In parallel, investors are keeping a close watch on evolving Middle East tensions. Reports indicate that US President Donald Trump has extended Iran a final opportunity to negotiate an end to its nuclear program, postponing a decision on potential military action for up to two weeks. In other developments, China has swiftly condemned Israel for its attack on Iran but has so far stopped short of providing Tehran with any significant support beyond maintaining routine trade relations. As the week progresses, the currency seems poised for modest gains.