FX.co ★ Offshore Yuan Starts the Week Flat

The offshore yuan remained relatively stable around 7.19 per dollar on Monday, pausing its decline after two consecutive losing sessions. This steadiness came as investors evaluated the People’s Bank of China’s daily midpoint setting. The central bank's reference rate for USD/CNY was positioned at 7.1322, slightly stronger than the previous session's 7.1371, signaling Beijing's preference for currency stability. Market players are also considering the potential for additional policy measures from Beijing aimed at bolstering economic growth and mitigating the effects of U.S. tariffs, following recent reports of weakened factory output and a slowdown in retail sales. Investor sentiment was cautious ahead of the upcoming decision on the loan prime rate, where expectations suggest it will likely remain unchanged. Globally, focus is shifting towards the Federal Reserve’s Jackson Hole symposium. Here, Chair Powell may indicate the potential for a rate cut in September. Additionally, political analysts are observing the meeting between President Trump and President Zelenskiy in Washington.