FX.co ★ Offshore Yuan Firms Over 4-Week High

The offshore yuan maintained its upward trajectory, trading around 7.15 per dollar on Tuesday, nearing its highest mark in over four weeks. This strength was bolstered by the declining US dollar, following President Trump's decision to terminate Fed Governor Lisa Cook's position. This move sparked concerns about the central bank's independence and bolstered expectations of earlier interest rate cuts. Just days ago, Federal Reserve Chair Jerome Powell adopted a dovish stance during the Jackson Hole Symposium, indicating a potential rate cut in September. In international trade developments, President Trump cautioned China about supplying rare-earth magnets to the US, threatening tariffs of up to 200% if compliance is not met, alongside the possibility of imposing levies on nations with digital taxes, which could negatively impact the yuan. Concurrently, Beijing, having imposed stricter export controls on rare earths back in April, remains highly sensitive to its pivotal role in this sector.