Standard Chartered Lifts Yuan Forecast to 6.46
On.cc · 2 SOURCESabout 1 hour ago2 MIN
Summary
Standard Chartered has upgraded its forecasts for the renminbi against the US dollar, raising its end-2025 target to 6.65 from 6.8 and its end-2026 target to 6.46 from 7.0. The bank said the revision reflects a medium-term bullish view based on stronger structural current-account performance, faster-than-expected improvement in fundamentals, and China’s rapidly strengthening artificial intelligence competitiveness. It also argued that seasonal conditions after dividend payments and the People’s Bank of China’s firm support for renminbi internationalisation should help offset headwinds including new US tariff threats, possible secondary sanctions, and the wide China-US interest-rate gap. On Thursday, the official central parity rate was set at 6.7829, up 23 pips, while the onshore yuan closed at 6.7205 at 4:30 pm after a second straight gain
Key Points
- Standard Chartered now expects the yuan at 6.65 by end-2025 and 6.46 by end-2026, versus its previous forecasts of 6.8 and 7.0.
- The bank said renminbi fundamentals are improving faster than expected, mainly because of a structural strengthening in China’s current account surplus.
- Despite higher tariffs and Middle East conflict, China’s goods trade surplus hit record highs, with strong exports in the first seven months
- Standard Chartered said more than 80% of export growth was driven by AI-related or industrial-upgrading products, while China’s IT services surplus also surged
- The report added that offshore yuan rose from about 6.75 at the start of August to around 6.71, while the central parity reached a near three-and-a-half-year high
Why It Matters
For Hong Kong readers, a firmer renminbi can affect trade settlement, cross-border investment flows and the Hong Kong dollar value of mainland assets and income streams. The call also ties currency strength to China’s AI and industrial-upgrading story, a theme that matters for Hong Kong-listed exporters, technology suppliers and investors tracking mainland policy direction.