Yuan to see only a modest rise amid trade war risk - Reuters poll

Results of the latest Reuters poll showed that the Chinese Yuan will pare some of its losses and rise modestly over the coming year, as the PBOC is likely to buoy the currency amid ongoing US-China trade dispute.

Key Findings:

‘The Yuan is expected to gain 1 percent to 6.77 per dollar in a year, according to the poll of over 50 foreign exchange strategists taken Sept 3-5 from around 6.84 late on Wednesday.

However, 18 of 40 common contributors have now revised their forecasts to a weaker Yuan compared with a poll taken last month, citing the risk that global trade tensions worsen.

Thirteen of them kept their projections unchanged and the remaining 9 revised them to reflect a stronger currency.

Nine strategists see the Yuan weakening to 7 to the dollar or higher at some point over the 12-month period, two more than in the poll taken one month ago.

Seventeen of 50 participants said the Yuan will weaken below the current level of 6.84 in a year with the most pessimistic forecast expecting it to fall to 7.30, a level not seen since last financial crisis.

Policy tightening from the U.S. Federal Reserve and rising Treasury yields could affect the Yuan’s stability.”