FX.co ★ Offshore Yuan Holds Ahead of Tariff Truce Deadline

The offshore yuan maintained its downward trend, hovering around 7.19 per dollar on Monday. This movement comes as investors anticipate the impending deadline for a potential truce in the US-China tariff stand-off, a decision that could shape the future of bilateral trade relations. Discussions have become more focused, with semiconductor policy emerging as a key topic. Market analysts predominantly foresee an extension to evade significant tariff escalation. It has been reported that Nvidia and AMD have consented to allocate a portion of their Chinese revenue to the US in return for export licenses, while China is advocating for the easing of restrictions on advanced AI chips ahead of a potential summit between Presidents Trump and Xi. On the economic indicators front, China's consumer inflation was unchanged in July, with producer prices continuing to show deflationary trends, reflecting a slump in demand amid the sensitive US truce. Meanwhile, in Washington, Treasury Secretary Bessent confirmed an October deadline to finalize negotiations with remaining countries, following successful agreements with the EU, Japan, and others. Talks with India are progressing, aiming for completion by October–November.