Surging yuan is one of the world’s best performing currencies this year | WHAT REALLY HAPPENED

Surging yuan is one of the world’s best performing currencies this year

Chinese currency trading outside the mainland surged to its highest level in 17 months on Tuesday, with the offshore yuan extending its rally to 6.7136 per US dollar. The yuan retreated slightly on Wednesday, trading at 6.7910.

The onshore yuan foreign exchange market remained closed for the ‘Golden Week’ national holiday, with trading set to resume on Friday.

“The yuan exchange rate is mainly determined by market supply and demand. The central bank will not use the yuan exchange rate as a tool to deal with disruptions from trade frictions,” the country’s central bank said in its second quarter monetary policy report.

As part of the phase one trade deal signed with the US in January, Beijing agreed not to devalue its currency to gain a competitive trade advantage.

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