The Chinese yuan has fallen to a two-year low against the US dollar and is likely to continue to weaken amid monetary easing by the People's Bank of China, trying to support the weakening economy, Report informs citing Interfax.
The exchange rate of the yuan on August 23 is 6.8469/$1 compared to 6.8489/$1 at the close of the previous session. In the course of trading, it fell to 6.8661/$1, which, according to FactSet, is the lowest since August 2020. The offshore yuan (traded in Hong Kong) fell below 6.88 yuan/$1.
Since the beginning of this year, the yuan has lost about 8% of its value against the dollar, which is due both to the general strengthening of the American currency against the backdrop of a tightening policy by the Federal Reserve System (Fed), and signals of a weakening Chinese economy due to quarantine restrictions imposed by the country's authorities to contain the spread of the coronavirus, Dow Jones notes.