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Foreign exchange market

Foreign exchange market
The global foreign exchange (forex) market has ballooned in recent decades as more and more economies liberalise their capital accounts.
last updated:
9 September, 2024
The Chinese yuan’s latest decline was driven by the US Fed’s fresh projection of only two quarter-point rate cuts in 2025. Photo: Reuters
Yuan

US Fed’s hawkish rate-cut forecast slams China’s yuan

China’s currency, hammered since Trump’s re-election, has depreciated further against the US dollar, despite the yuan’s share among global payments rising.

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Currencies

Opinion | Trump’s fuming over unlikely ‘Brics currency’ belies risks of de-dollarisation

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United States

Opinion | An America awash in global capital risks spreading financial instability

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Yuan

Yuan to catch up to China’s position in world’s economy: ex-official

Outspoken former Chongqing mayor Huang Qifan says Hong Kong can play a key role in the internationalisation of the yuan.

An employee counts yuan notes at a bank in Beijing. Photo: AFP
Banking & finance

Goldman Sachs CEO says it is too difficult to get capital out of China

With venture capital transactions by American investors at the lowest level in nearly four years, investors need reassurance, Solomon says.

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Hong Kong Monetary Authority (HKMA)

Hong Kong’s financial war chest posts record gain of US$28.8 billion

Lawmakers asked whether the fund could give more to address the government’s deficit, but HKMA’s CEO urged sticking with an existing formula.

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US-China relations

US financial-sanction threat should make China rethink forex holdings: economist

‘Possible future sanctions from the US’ under a new US president have set off alarms in Beijing’s policy circles.

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China’s foreign-exchange reserves totalled US$3.316 trillion as of September. Photo: Shutterstock
Yuan

Beijing urged to offer more yuan loans overseas to help dethrone US dollar

National Academy of Development and Strategy says China should be main source of liquidity for developing countries.

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China manufacturing

Why ‘significant’ shipping deal bolsters China’s manufacturing, boosts yuan use

Hudong-Zhonghua Shipbuilding is due to deliver six vessels to a Hong Kong containership lessor by 2028.

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Yuan

China’s yuan faces volatility amid US pressure and home-grown stimulus: analysts

A stronger yuan could drag down China’s export growth, and the central bank is expected to guard against excessive appreciation.

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Strong US jobs data released last week could affect the exchange rate between the US dollar and Chinese yuan, according to some analysts. Photo: Shutterstock
Banking & finance

HKMA wants to continue developing Greater Bay Area, expand connect schemes

The de facto central bank will work with mainland authorities to develop the Greater Bay Area and expand cross-border trading, CEO Eddie Yue says.

HKMA CEO Eddie Yue starts his second five-year term on Tuesday. Photo: Jonathan Wong
Yuan

China’s yuan gains ground after rate cuts, exporters’ US dollar exodus

Cuts by the Federal Reserve have prompted exporters to convert their US dollar assets into yuan, strengthening China’s currency.

Singapore

Singapore Exchange eyes Middle East move to target Dubai-bound hedge funds

The planned expansion comes as major fund managers flock to Dubai, attracted by favourable tax conditions and government incentives.

Banking & finance

Dump or buy more? China’s holding of US debt in spotlight after Fed’s rate cut

Continued diversification of reserve portfolio may be in order, but into what, and at what speed, are pressing questions.

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Jerome Powell, chairman of the US Federal Reserve, announced a cut to its benchmark interest rate on Wednesday. Photo: Bloomberg
Bonds

China’s stealthy yuan support ebbs, denting hot hedge fund trade

A lucrative trade that helped hedge funds ratchet up profits on Chinese debt instruments is starting to lose its charm, analysts say.

Chinese state banks had been using foreign-exchange obtained in the swaps market to support the yuan in spot trading. Photo: Shutterstock
Banking & finance

Explainer | What 3 changes has China’s central bank made amid monetary policy reshuffle?

China’s central bank has conducted at least three large monetary adjustments since Pan Gongsheng was named People’s Bank of China governor in July 2023.

Yuan

China’s yuan to continue to gain, but outlook hinges on Fed rate cuts: analysts

China’s yuan gained 1.9 per cent against the US dollar in August, which represented the largest monthly change since November.

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Yuan

Can the yuan really become a truly international currency that everyone wants?

China’s yuan has become more acceptable to foreign countries, but authorities still maintain tight control of fund flows under its capital account.

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Illustration: Lau Ka-kuen
Yuan

Interest rates, US election adding to yuan volatility: Goldman

Moves by the US Federal Reserve, as well as November’s US presidential election, would discourage selling the yuan, Goldman Sachs said on Friday.

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Banking & finance

Opinion | With US rate cuts on the horizon, the glass looks half full again

Lower US rates, helped by Japan’s normalising policy, would boost liquidity and ease dollar pressure, with better days ahead for emerging markets.

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Yuan

China’s yuan fitting the bill as currency wins record share of global payments

China’s yuan has won a record share in global settlements, an indication the country’s efforts to internationalise its currency are continuing to bear fruit.

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China’s yuan has increased its share of global payments, reaching a new record in July. Photo: Reuters
China stock market

Chinese stocks upgraded as state support seen tempering bear-market fallout: BCA

Chinese stocks could fall less than their global peers in a sell-off, as recent technical breakdown puts equities at risk of further declines, BCA Research says.

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People walk on an overpass with a display of stock information in the Lujiazui financial district in Shanghai on August 6. Photo: Reuters
Yuan

As Black Monday 2.0 sweeps Asia, China’s yuan surges with US rate cuts looming

Onshore yuan rallied to a high of 7.1150 per US dollar during morning trading, the strongest level since January 2.

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US presidential election 2024

Macroscope | Second Trump presidency would pose little threat to King Dollar

While Donald Trump returning as president poses political risks, the US dollar is more insulated against his policies than many might think.

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Smartphones

Xiaomi, Vivo share top spot in India’s smartphone market in second quarter

Chinese smartphone maker Xiaomi is back on top in India after losing its crown in the world’s second-largest handset market 18 months ago, but has to share the leaderboard with rival Vivo.

Customers inspect Xiaomi smartphones at the company’s store in Gurgaon, India. Photo: AFP
Yuan

With US Fed rates staying in stratosphere, the pressure’s on for China’s yuan

The Bank for International Settlements has praised China and other developing economies in managing their monetary policy, but cautioned pressure will remain high as US Fed rates remain unchanged.

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With the US Federal Reserve maintaining high interest rates, stress is accumulating on the currencies of developing economies. Photo: Bloomberg
Yuan

China’s central bank puts the yuan’s exchange-rate swings in crosshairs

A stable exchange rate plays a key role in China’s position as a major importer and exporter, but the yuan has come under heavy pressure from the US dollar.

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United States

Macroscope | US is stuck in a vicious cycle that could spell crises elsewhere

No state can withdraw from globalisation on its own terms, and the world cannot have one power in effect running monetary policy on behalf of everyone else.

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