Recent sharp appreciation trend of the Yuan against the Dollar is unlikely to be sustained in the near term, according to economists at MUFG Bank. USDCNY is set to move between the range of 7.00-7.15. 

Upside risk for revaluation of CNY ahead 

“COVID-19 management can be a challenging task, driving up the volatility of the Yuan in the near term, so, we see a volatile USDCNY to move in the range of 7.00-7.15.”

“With a clear determination of government in boosting Chinese economy and optimizing covid policies, we are holding a positive view for China’s medium growth (5.1% for 2023), and expect USDCNY to decline to 6.65 by the end of 2023.”