Chinese Yuan: Does the outlook favour appreciation into 2027? – OCBC

The Chinese Yuan’s resilience amid broader US Dollar (USD) gains, together with expectations that USD strength will ease, supports a gradual appreciation path. OCBC strategists Sim Moh Siong and Christopher Wong remain constructive on the currency, forecasting USD/CNY at 6.62 by end-2026 and 6.46 by end-2027. Firmer PBoC fixings indicate greater policy tolerance for Renminbi (RMB) appreciation, though renewed USD rallies or weaker domestic growth could pose risks to this measured trajectory.

Can policy support sustain measured RMB appreciation?

"We maintain a constructive outlook on RMB, with USD/CNY projected at 6.62 at end-2026 and 6.46 at end-2027."

"The recent pattern of stronger PBoC fixings appears to suggest slightly greater policy tolerance for continued RMB appreciation, although we expect the pace to remain measured."

"RMB’s resilience despite broader USD strength also points to an increasingly constructive market bias towards appreciation, reinforcing expectations for further currency gains."

"We expect this appreciation trajectory to extend into 2027, supported by a gradual easing in USD strength, although periodic consolidation is likely."

"A renewed USD rally, softer domestic growth or a shift in the fixing trajectory could temper the pace of appreciation."

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