Log in
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 

MarketScreener Homepage  >  News  >  Economy & Forex

News : Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

China's yuan forwards hit highest since late 2017

share with twitter share with LinkedIn share with facebook
08/03/2020 | 02:36am EDT

SHANGHAI, Aug 3 (Reuters) - China's yuan forwards hit a more than 2-1/2 year high on Monday, driven by expectations of a widening yield gap between the world's two largest economies.

One-year onshore dollar/yuan swap points rose to 1,448 points in afternoon trade, the highest since November 2017, while the offshore swap point for the same tenor hit 1,493 points, the loftiest since December 2017.

Traders and analysts said higher swap points in both onshore and offshore were due to expectations of a widening yield gap between China and the United States, a result of the divergence in the monetary policy stances of the two countries.

"With the Chinese economy recovering, officials have signalled that monetary policy may not be as accommodative as in Q1," economists at ANZ said in a note.

"Instead of broad-based easing, we expect further easing to be targeted and modest, hinging on the pace of economic recovery."

China was the world's first major economy to declare a return growth in the second quarter after a deep slump at the start of the year. However, unexpected weakness in domestic consumption underscored the need for policy to bolster the recovery after the shock of the coronavirus crisis.

Gross domestic product (GDP) rose 3.2% in the second-quarter from a year earlier, beating market forecasts.

Yi Gang, Governor of the People's Bank of China (PBOC), said in a recent meeting that the government would enhance the effectiveness of monetary policy for certain sectors, according to a statement posted on Monday morning.

Market participants also see China's macroeconomic policy shifting to normal from emergency mode as the economy bottomed out following a meeting by China's top decision-making body last week.

In the meantime, the U.S. Federal Reserve last week maintained its dovish policy stance and pledged to "do what we can, and for as long as it takes" to limit damage caused by coronavirus shock. (Reporting by Winni Zhou and Andrew Galbraith; Editing by Jacqueline Wong and Sam Holmes)

Stocks mentioned in the article
ChangeLast1st jan.
BANK OF CHINA LIMITED 0.42% 2.4 End-of-day quote.-27.93%
UNITED STATES DOLLAR (B) / CHINESE YUAN IN HONG KONG (USD/CNH) -0.50% 6.7467 Delayed Quote.-2.57%
share with twitter share with LinkedIn share with facebook
Latest news "Economy & Forex"
01:10pEM central bank easing runs out of steam after 20 months of cuts
01:09pU.S. CDC reports 206,402 coronavirus deaths
01:06pWall Street rises on stimulus bets as economic recovery cools
01:06pGermany's financial watchdog to ban staff from trading in companies it oversees in wake of wirecard scandal - finance ministry official
01:05pWall Street rises on stimulus bets as economic recovery cools
01:03pVenezuela's PDVSA to install ship-to-ship hub away from shore -sources
01:00pOil drops 5% on weak demand outlook and higher OPEC supplies
12:59pU.S. CDC Reports Total Novel Coronavirus Cases Of 7,213,419 As Of Yesterday Versus 7,168,077 In Previous Report On Sept. 30
12:59pU.s. cdc reports total novel coronavirus cases of 7,213,419 as of yesterday vs 7,168,077 in previous report on sept. 30
12:59pU.s. cdc reports total deaths of 206,402 due to coronavirus as of yesterday vs 205,372 in previous report on sept. 30
Latest news "Economy & Forex"