FX.co ★ Offshore Yuan Hits Fresh 34-Month High

The offshore yuan strengthened to around 6.89 per USD on Monday, reaching a new thirty-four-month high as mainland markets entered the week-long Lunar New Year holiday and price discovery shifted to offshore venues. With onshore exchanges closed for the Spring Festival, market liquidity is thinner than usual, making prices more sensitive to capital flows and amplifying the yuan’s upward move. The firmer currency also reflects expectations that strong holiday travel and consumer spending will support near-term domestic activity, even as authorities continue to prioritize overall exchange-rate stability. With mainland trading on hold, volatility is likely to remain elevated until full market participation resumes later this week. On the geopolitical front, reports that the US has suspended several tech-related security measures targeting China ahead of a planned April meeting between Presidents Donald Trump and Xi Jinping have eased immediate tensions, although broader strategic frictions persist.