Chinese Yuan: PBoC defends yuan narrative – Commerzbank

Commerzbank’s FX team highlights that the People’s Bank of China rejected claims the yuan is undervalued, linking export strength to industrial competitiveness rather than currency manipulation. The central bank will start reporting FX operations to the IMF from 2027, while reserves slipped to USD3.40tn. In FX, USD/CNY fell 30 pips to 6.70, with USD/CNH little changed at 6.70.

Policy paper counters undervaluation claims

"The People’s Bank of China (PBoC) issued a policy paper rejecting claims that the yuan is undervalued, arguing that China's export strength reflects industrial competitiveness rather than currency manipulation."

"The statement came as EU trade officials opened two days of talks with Chinese counterparts, with Brussels increasingly framing bilateral trade imbalances as a currency issue. The PBoC’s paper signals Beijing’s intent to shape the narrative before any formal demands on exchange rate adjustment can gain traction."

"PBoC argued there is no linear relationship between the exchange rate and the current account balance, and that past periods of yuan depreciation did not accelerate China’s export market share gains. The central bank also announced that China will begin reporting foreign exchange operation data to the IMF starting in 2027, a concession to longstanding calls for greater transparency."

"Credit demand remains sluggish, and the investment-led policy push has not yet generated a broader economic rebound. China’s foreign exchange reserves fell to USD3.40tn at end-September (Bloomberg consensus: USD3.43tn) vs USD3.44tn at end-August, partly reflecting valuation effects from gold price weakness during the month."

"The move is modest in scope but notable in timing, offering a goodwill gesture to multilateral institutions as bilateral trade tensions with Europe escalate. Separately, the broader global push back against Chinese export dominance is intensifying, with France and Germany pushing the European Commission toward more assertive protective measures."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Singapore Dollar: Range trading persists against US Dollar – UOB

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note that USD/SGD remains supported within the Monetary Authority of Singapore’s policy band, with SGD NEER likely between 1.50% and 1.80% above midpoint, implying a 1.279–1.283 range. Short-term price action shows limited upward momentum, with resistance near 1.2835 and revised strong support at 1.2775.
了解更多 Previous

Aussie extends weekly gains as Fed pause bets offset hawkish rhetoric

The Aussie Dollar ended Friday’s session on a positive note, gaining 0.38% and 0.58% weekly as the US Dollar trimmed some of its weekly gains, while US data confirmed investors' expectations that the Federal Reserve would hold rates steady in the October meeting. The AUD/USD trades at 0.6983.
了解更多 Next