And that’s despite the currency’s strong recovery over the past two months, with USD/CNY peaking at 7.30 from late October to early November. The exchange rate above 8 is the worst performance of the Chinese yuan against the dollar since 199 , when China combined market and official exchange rates. USDCNY I have argued several times over the year that if China allows its currency to weaken, that is a significant bearish signal to the dollar’s upside – as we saw here in August. As such, it will continue to be a key driver of the dollar next year as the Fed’s tightening cycle is questioned and China moves away from its zero Covid policy.
China’s yuan set for biggest yearly loss since 1994
