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USD/CNH rises as US-China trade truce is extended
A two-month extension pushed the truce end date to January 10, helping exporters keep exposure in dollars rather than switching to yuan before then, FXStreet reported.
China’s trade messaging during President Xi Jinping’s White House visit omitted any mention of tariffs, while attention in FX markets instead focused on a US-China trade truce extension that runs through January 10, according to FXStreet.
FXStreet said the truce previously set to lapse on November 10 was extended by about two months, and it keeps tariffs on Chinese goods from reverting higher. The outlet added that this reduces incentives for some exporters holding dollars to switch into yuan ahead of the January cutoff.
The article also pointed to People’s Bank of China action, saying the PBoC stopped firming its daily yuan midpoint after ten sessions. That shift came as the dollar traded near its strongest level in nearly two months on expectations the Fed could raise rates again, with USD/CNH rising for a third straight session.
FXStreet noted USD/CNH climbed off Monday and Tuesday lows near 6.6900, and Wednesday’s move was the largest of the three sessions. The pair reportedly recovered the losses from a slide that started September 17, returning toward 6.7200, though it remained below its 50-day exponential moving average near 6.7300.