Skip to content Offshore Yuan Rises as China Plans New Stimulus
The offshore yuan increased slightly to about 7.12 against the dollar, recovering from a low not seen in over a month. This increase occurred as traders expected China to announce new economic support actions. The housing minister is scheduled to speak this Thursday, drawing attention.
Investors are also waiting for important economic reports from China. These include the country’s GDP, industrial output, and consumer spending figures, which will be released on Friday.
On October 16, China’s central bank used seven-day reverse repos to add 642.4 billion yuan to the financial system. Despite this, with 789 billion yuan of MLF loans and 61 billion yuan of other reverse repo loans, due to expire the next day, the overall effect was a reduction in liquidity by 207.6 billion yuan.
Earlier in the week, China’s trade numbers were lower than expected, with exports and imports not meeting forecasts. Additionally, consumer price growth fell to its lowest since June, emphasizing the critical need for more robust economic policies. Meanwhile, producer prices continued to decrease for the 24th month in a row, indicating persistent issues in domestic demand.
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