Offshore Yuan Holds at Strongest Since 2022

The offshore yuan held around 6.69 per dollar on Friday, remaining at its strongest level since July 2022 as China accelerates efforts to establish the currency as a global player. Beijing is broadening the range of available investment products and financial instruments, including derivatives and hedging tools, while easing access to dim sum and panda bond issuance. Progress also includes expanding offshore-yuan investment options, deepening yuan-based financing, and strengthening cross-border clearing and settlement infrastructure. Meanwhile, caution lingered over persistent China-EU trade tensions as the bloc considers new powers to restrict access to its single market and assesses import data for potential surges, a preliminary step toward imposing quotas on additional goods. China has warned of retaliation against any new EU trade measures or discriminatory restrictions targeting Chinese companies or products beyond the hybrid vehicle export cap agreed last week.