China’s yuan poised to break its longest streak of weekly gains since 2012 amid Middle East unrest

Yuan Faces Weekly Decline Amid Middle East Tensions

On Friday, the Chinese yuan edged slightly higher against the US dollar, yet it appeared set to break its longest streak of weekly gains and experience its sharpest drop in over a year. This movement was largely driven by a stronger dollar, influenced by escalating unrest in the Middle East.

The People’s Bank of China, the country’s central bank, recently eliminated foreign exchange risk reserves for forward contracts. This policy change spurred greater demand for dollars among businesses in the derivatives market.

By 0400 GMT, the onshore yuan was trading at 6.9005 per dollar, marking a 0.17% increase from the previous session. If the currency maintains this level through the end of trading, it will confirm the weekly downturn.