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Chinese Yuan Gains Ground Against U.S. Dollar
(MENAFN) The Chinese currency has shattered a critical exchange rate barrier against the greenback, climbing to its strongest position since September 2022 as the US dollar buckles under mounting geopolitical and trade tensions.
China's yuan surged to 6.9929 per dollar—breaching the psychologically significant 7-per-dollar level for the first time in over three years—following a sharp selloff in the US Dollar Index triggered by escalating political turmoil surrounding Greenland.
The dollar's weakness intensified after US President Donald Trump issued tariff threats targeting approximately eight European nations, conditioning the trade measures on their acceptance of his Greenland annexation claims. The aggressive stance sent shockwaves through currency markets, accelerating the broader Dollar Index decline.
China's currency had experienced sustained depreciation against the dollar beginning in March 2022, with losses accelerating sharply once the US Federal Reserve launched its aggressive monetary tightening campaign through rapid interest rate increases in response to post-COVID-19 pandemic inflation.
The yuan breached the 7-per-dollar threshold in September 2022 as the Fed's rate hikes drove capital flows toward dollar-denominated assets. That same month, the Chinese currency plummeted to its weakest valuation since the devastating 2008 global financial crisis.
The current breakthrough below the 7-per-dollar mark represents a dramatic turnaround following years of relentless downward pressure fueled by global monetary policy shifts and volatile international trade conditions.
China's yuan surged to 6.9929 per dollar—breaching the psychologically significant 7-per-dollar level for the first time in over three years—following a sharp selloff in the US Dollar Index triggered by escalating political turmoil surrounding Greenland.
The dollar's weakness intensified after US President Donald Trump issued tariff threats targeting approximately eight European nations, conditioning the trade measures on their acceptance of his Greenland annexation claims. The aggressive stance sent shockwaves through currency markets, accelerating the broader Dollar Index decline.
China's currency had experienced sustained depreciation against the dollar beginning in March 2022, with losses accelerating sharply once the US Federal Reserve launched its aggressive monetary tightening campaign through rapid interest rate increases in response to post-COVID-19 pandemic inflation.
The yuan breached the 7-per-dollar threshold in September 2022 as the Fed's rate hikes drove capital flows toward dollar-denominated assets. That same month, the Chinese currency plummeted to its weakest valuation since the devastating 2008 global financial crisis.
The current breakthrough below the 7-per-dollar mark represents a dramatic turnaround following years of relentless downward pressure fueled by global monetary policy shifts and volatile international trade conditions.
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