FX.co ★ Offshore Yuan Steady After PBOC Decision

The offshore yuan maintained stability at approximately 7.17 per dollar on Monday as the markets processed the People's Bank of China's latest policy decision. As anticipated, the central bank maintained its benchmark lending rates at historic lows during the July rate-setting session. The one-year loan prime rate, a crucial benchmark for most corporate and household loans, remained steady at 3%, and the five-year loan prime rate, which guides mortgage rates, stayed unchanged at 3.5%. This decision reflects the ongoing challenges of weak consumer sentiment and inconsistent economic growth. Additionally, external pressures, notably due to the newly imposed U.S. tariffs, continue to exert strain on the economic outlook. On Sunday, the White House reaffirmed its tariff policy, declaring August 1 as the "hard deadline" for countries to begin adhering to tariff payments. Meanwhile, discussions are underway for a potential meeting between President Trump and Chinese President Xi, either before or during the Asia-Pacific Economic Cooperation summit in South Korea in October. These talks aim to address trade disputes and explore avenues for cooperation.