China yuan hits 3-1/2-year high as yen strength weighs on dollar

According to Business Recorder, the yuan pushed to a new 3-1/2-year peak against the US dollar on Thursday, helped by a far firmer fixing from the central bank. The People's Bank of China placed the daily midpoint at 6.7807 per dollar ahead of trading, its firmest level since February 8, 2023. That reference rate sat 640 pips below a Reuters estimate of 6.7167.

The onshore spot rate rose to 6.7180 per dollar, the highest since February 2, 2023, and was trading at 6.7183 by 0328 GMT. Offshore yuan changed hands at 6.7177 per dollar. A dealer with a Chinese lender said the currency's advance reflected the yen's recovery, and that attention would soon move to US nonfarm payrolls due Friday.

The central bank has set the midpoint weaker than market forecasts since November 2025, a pattern analysts and traders read as an attempt to keep the currency stable and slow its quick rise. Goldman Sachs economists expect gradual yuan appreciation of 3-5% a year against the dollar, citing goals such as growth in advanced industries and wider use of the renminbi. Year to date, the currency has advanced more than 4% versus the dollar and ranks among the top Asian performers.