Yuan Weakens As Investors Look To U.S. Inflation Data

Yuan Weakens As Investors Look To U.S. Inflation Data

13 Apr 2021 11:09 AM
 

China's yuan inched lower against the dollar today, as investors became cautious ahead of U.S. inflation data, shrugging off a slew of strong economic indicators that pointed to continued recovery in the world's second-largest economy.

Some currency traders said global markets were anxiously awaiting U.S. inflation data due later in the session that could suggest a faster economic rebound in the United States.

Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate at 6.5454 per dollar, 124 pips or 0.19% firmer than the previous fix of 6.5578.

The onshore spot yuan opened at 6.5470 per dollar and was changing hands at 6.5502 at midday, 27 pips weaker than the previous late session close.

The yuan market was little reacted to a series of upbeat economic data released this week. Earlier in the session, China reported strong trade data showing exports grew at a robust pace in March in yet another boost to the nation's economic recovery, while import growth surged to the highest in four years.

Separately, new bank loans in China rose more than expected in March from the previous month due to strong corporate and household demand, as the central bank walks a tightrope between supporting the rapidly recovering economy and containing debt risks.

The upbeat loan growth data has convinced some analysts and economists that the PBOC was likely to stay on hold for the remainder of the year.

The global dollar index rose to 92.258 at midday, while the offshore yuan was trading at 6.5529 per dollar.