Chinese Yuan Weakens Against the US Dollar as Tariffs to Stay For Some More Time

The Chinese yuan is trading weaker against the US dollar early on Wednesday after the US signaled that tariffs on Chinese imports would

USD/CNH - US dollar vs. Chinese yuan

The Chinese yuan is trading weaker against the US dollar early on Wednesday after the US signaled that tariffs on Chinese imports would continue at least until the upcoming presidential elections. At the time of writing, USD/CNH is trading around 6.897.

The yuan had been gaining strength against the US dollar in recent weeks over rising optimism about the signing of the phase one trade deal, which is scheduled to take place later today. However, markets have turned more cautious and tempered their hopes after US Treasury Secretary commented that tariffs on Chinese goods would likely remain until phase two of the trade agreement gets finalized.

USD/CNH has also turned more bullish following a slight increase in US consumer prices during December. CPI rose by 0.2% in December, slightly lower than the 0.3% rise seen in November. However, CPI rose 2.3% higher in the 12 months to December, the largest rise seen since October 2018. The improvement in consumer price index has helped strengthen the US dollar.

ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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