HONG KONG: China’s yuan dipped against the US dollar on Thursday as the Trump administration signaled willingness to lower tariffs on China, leading to a dollar rebound overnight.
The greenback got a boost after US Treasury Secretary Scott Bessent said on Wednesday that more than 100% tariffs between the United States and China are not sustainable, along with reports that the Trump administration is considering lowering tariffs on Chinese goods pending talks with Beijing.
“We are going to have a fair deal with China,” Trump told reporters, but did not outline any specifics.
By 0415 GMT, the yuan was 0.15% lower at 7.2992 to the dollar after trading in a range of 7.2900 to 7.3022.
Its offshore counterpart traded at 7.2999 yuan per dollar , down about 0.19% in Asian trade.
As the pressure on exchange rates from tariff news eases, there is a reduced risk of rapid depreciation in the yuan, Nanhua Futures said in a note.
China’s yuan holds ground on trade optimism, regulator vows stability
“We expect the yuan to fluctuate around 7.30 this week,” they said.
Prior to the market opening, the People’s Bank of China set the midpoint rate, around which the yuan is allowed to trade in a 2% band, at 7.2098 per dollar, 1,013 pips firmer than a Reuters’ estimate.
Meanwhile, China is stepping up support for the use of its currency in global trade amid trade tensions with the United States.
China’s plan to facilitate cross-border financial services will help promote greater international usage of the yuan, a senior central bank official said on Wednesday.
The central bank published a plan earlier this week encouraging state-owned enterprises to prioritise yuan usage in payment and settlement as they expand overseas expansion.
The dollar’s six-currency index was 0.105% lower at 99.68.
