Technical Analysis

Former China SAFE official says conditions are favorable for yuan to trend higher in 2023

Bank of China International’s global chief economist and a former official at the State Administration of Foreign Exchange Guan Tao has an op-ed in China’s Global Times.

It’s a long piece and worth a read. He concludes by noting that the yuan will rise based on China’s economic fundamentals:

  • With the optimization of pandemic responses and relaxed real estate regulation, the accelerated restart of the economy, domestic and foreign investors are mostly optimistic about the prospects for China’s economic recovery and the growing value of the yuan.
  • This is a favorable condition for the strengthening of the yuan exchange rate trend in 2023.

CNH is off to a good start already this year, pressing on with gain begun in October 2022:

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